Cathie Wood's Preference for Bitcoin
Cathie Wood, the founder and CEO of Ark Investment Management, recently expressed her strong support for bitcoin as a long-term investment. In a podcast interview with Bloomberg's "Merryn Talks Money," Wood confidently stated that if given the choice between gold, cash, or bitcoin as a ten-year investment, she would pick bitcoin "hands down."
Bitcoin's Advantage Over Traditional Assets
Wood's endorsement of bitcoin comes as no surprise, considering her previous predictions and observations about the cryptocurrency. She believes that bitcoin serves as an effective hedge against both inflation and deflation, just like gold. However, Wood notes that bitcoin has the advantage of being digital, while gold's demand has already been established.
Bitcoin's Potential
Wood has long been a proponent of bitcoin, and she has made bold predictions about its future value. In September 2021, just before bitcoin reached its peak value of $69,000, Wood projected that it could eventually reach $500,000 within five years. She also anticipates the growth of the metaverse, predicting it to become a multi-trillion-dollar industry in the same timeframe.
Generational Shift in Asset Preference
Wood acknowledges that institutional investment in bitcoin is still in its early stages. However, she emphasizes that young people are more inclined to hold bitcoin than gold. This generational shift in asset preference could have significant implications for the future of bitcoin and the broader investment landscape.
Deflationary Economy
At Ark Invest, Wood's team anticipates a notable deflationary period for the U.S. economy, which is currently plagued by uncertainties. Wood maintains her belief that deflation is on the horizon and points to emerging evidence of this trend. She compares the current economic climate to the 19-teens rather than the inflationary period of the 1970s.
Bitcoin as a Hedge Against Inflation
Contrary to popular belief, Wood does not believe that bitcoin's value is solely driven by inflation. She argues that one of bitcoin's key advantages is its lack of counterparty risk. Bitcoin operates on a transparent and decentralized network, where all transactions can be easily tracked. In contrast, regional banks operate with less transparency, making it difficult to assess their financial health.
Insights on Artificial Intelligence and Tesla
In addition to discussing bitcoin, Wood also shared her insights on artificial intelligence (AI) and Tesla during the podcast interview. These topics align with her investment philosophy, which focuses on disruptive technologies and companies at the forefront of innovation.
In conclusion, Cathie Wood's endorsement of bitcoin as a superior investment over gold and cash highlights her confidence in the cryptocurrency's long-term potential. As a prominent figure in the investment world, Wood's views carry weight and may influence others to consider bitcoin as a viable asset for their portfolios.
Frequently Asked Questions
What is a Precious Metal IRA, and how can you get one?
A precious metal IRA allows you to diversify your retirement savings into gold, silver, platinum, palladium, rhodium, iridium, osmium, and other rare metals. These are “precious metals” because they are hard to find, and therefore very valuable. These metals are great investments and can help protect your financial future from economic instability and inflation.
Bullion is often used for precious metals. Bullion refers to the actual physical metal itself.
Bullion can be bought through many channels, including online retailers, large coins dealers, and some grocery shops.
You can invest directly in bullion with a precious metal IRA instead of buying shares of stock. This allows you to receive dividends every year.
Precious Metal IRAs don’t require paperwork nor have annual fees. Instead, your gains are subject to a small tax. Plus, you get free access to your funds whenever you want.
How is gold taxed in an IRA?
The fair value of gold sold to determines the price at which tax is due. If you buy gold, there are no taxes. It's not considered income. If you sell it later you will have a taxable profit if the price goes down.
Gold can be used as collateral for loans. Lenders will seek the highest return on your assets when you borrow against them. Selling gold is usually the best option. However, there is no guarantee that the lender would do this. They may just keep it. They may decide to resell it. Either way you will lose potential profit.
If you plan on using your gold as collateral, then you shouldn't lend against it. You should leave it alone if you don't intend to lend against it.
How much should your IRA include precious metals
When investing in precious metals, the most important thing to know is that they aren't just for wealthy people. You don’t need to have a lot of money to invest. There are many methods to make money off of silver and gold investments.
You might also be interested in buying physical coins, such bullion rounds or bars. Shares in precious metals-producing companies could be an option. Your retirement plan provider may offer an IRA rollingover program.
You'll still get the benefit of precious metals no matter which country you live in. They are not stocks but offer long-term growth.
And unlike traditional investments, they tend to increase in value over time. If you decide to sell your investment, you will likely make more than with traditional investments.
What are the pros & cons of a Gold IRA?
An Individual Retirement Plan (IRA) has a major advantage over regular savings accounts. It doesn't tax any interest earned. An IRA is a great way to save money and not have to pay taxes on the interest you earn. But, this type of investment comes with its own set of disadvantages.
If you withdraw too many funds from your IRA at once, you may lose all your accumulated assets. Also, the IRS may not allow you to make withdrawals from your IRA until you're 59 1/2 years old. You will likely have to pay a penalty fee if you withdraw funds from an IRA.
A disadvantage to managing your IRA is the fact that fees must be paid. Most banks charge 0.5% to 2.0% per annum. Others charge management fees that range from $10 to $50 per month.
If you prefer your money to be kept out of a bank, then you will need insurance. Insurance companies will usually require that you have at least $500,000. You may be required by some insurers to purchase insurance that covers losses as high as $500,000.
If you decide to open a gold IRA, it is important to know how much you can use. Some providers limit how many ounces you can keep. Others allow you the freedom to choose your own weight.
You will also have to decide whether to purchase futures or physical gold. Futures contracts for gold are less expensive than physical gold. Futures contracts allow you to buy gold with more flexibility. Futures contracts allow you to create a contract with a specified expiration date.
You also need to decide the type and level of insurance coverage you want. The standard policy does not include theft protection or loss caused by fire, flood, earthquake. However, it does cover damage caused by natural disasters. You may consider adding additional coverage if you live in an area at high risk.
Additional to your insurance, you will need to consider how much it costs to store your gold. Storage costs are not covered by insurance. Additionally, safekeeping is usually charged by banks at around $25-$40 per monthly.
You must first contact a qualified custodian before you open a gold IRA. A custodian is responsible for keeping track of your investments. They also ensure that you adhere to federal regulations. Custodians can't sell assets. They must instead keep them for as long as you ask.
Once you've chosen the best type of IRA for you, you need to fill in paperwork describing your goals. Your plan should include information about the investments you want to make, such as stocks, bonds, mutual funds, or real estate. Your monthly investment goal should be stated.
After filling in the forms, please send them to the provider. The company will review your application and send you a confirmation letter.
If you are thinking of opening a gold IRA for retirement, a financial professional is a great idea. Financial planners are experts in investing and will help you decide which type of IRA works best for your situation. They can help you find cheaper insurance options to lower your costs.
Can I buy gold using my self-directed IRA
Although you can buy gold using your self-directed IRA account, you will need to open an account at a brokerage like TD Ameritrade. Transfer funds from an existing retirement account are also possible.
The IRS allows individuals to contribute as high as $5,500 ($6,500 if they are married and jointly) to a traditional IRA. Individuals can contribute as much as $1,000 per year ($2,000 if married filing jointly) to a Roth IRA.
If you do decide you want to invest your money in gold, you should look into purchasing physical bullion instead of futures contracts. Futures contracts are financial instruments based on the price of gold. They allow you to speculate on future prices without owning the metal itself. You can only hold physical bullion, which is real silver and gold bars.
What are some of the benefits of a gold IRA
It is best to put your retirement money in an Individual Retirement Account (IRA). It's tax-deferred until you withdraw it. You can decide how much money you withdraw each year. There are many types and types of IRAs. Some are more suitable for students who wish to save money for college. Some are for investors who seek higher returns. Roth IRAs let individuals contribute after age 591/2 and pay tax on any earnings at retirement. These earnings don't get taxed if they withdraw funds. This account is a good option if you plan to retire early.
Because it allows you money to be invested in multiple asset classes, a ‘gold IRA' is similar to any other IRAs. Unlike a regular IRA that requires you to pay taxes on the gains you make while you wait to access them, a gold IRA does not have to do this. People who want to invest their money rather than spend it make gold IRA accounts a great option.
Another benefit of owning gold through an IRA is that you get to enjoy the convenience of automatic withdrawals. This eliminates the need to constantly make deposits. To avoid missing a payment, direct debits can be set up.
Finally, gold is one of the safest investment choices available today. Its value is stable because it's not tied with any one country. Even in economic turmoil, gold prices tends to remain relatively stable. Gold is a good option for protecting your savings from inflation.
Can I have a gold ETF in a Roth IRA
Although a 401k plan might not provide this option, you should still consider other options like an Individual Retirement Account (IRA).
An IRA traditional allows both employees and employers to contribute. You can also invest in publicly traded businesses by creating an Employee Stock Ownership Plan (ESOP).
An ESOP provides tax advantages because employees share ownership of company stock and profits the business generates. The money invested in the ESOP is then taxed at lower rates than if it were held directly in the hands of the employee.
An Individual Retirement Annuity (IRA) is also available. You can make regular payments to your IRA throughout your life, and you will also receive income when you retire. Contributions made to IRAs are not taxable.
Statistics
- Instead, the economy improved, stocks rebounded, and gold plunged, losing 28 percent of its value in 2013. (aarp.org)
- Gold is considered a collectible, and profits from a sale are taxed at a maximum rate of 28 percent. (aarp.org)
- If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal, so you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (forbes.com)
- Contribution limits$6,000 (49 and under) $7,000 (50 and up)$6,000 (49 and under) $7,000 (50 and up)$58,000 or 25% of your annual compensation (whichever is smaller) (lendedu.com)
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
External Links
wsj.com
- Saddam Hussein’s InvasionHelped Uncage a Bear In 1989 – WSJ
- You want to keep gold in your IRA at home? It's Not Exactly Legal – WSJ
finance.yahoo.com
investopedia.com
- Do You Need a Gold IRA to Get Retirement?
- What are the Options Types, Spreads, Example, and Risk Metrics
cftc.gov
How To
Investing in gold vs. investing in stocks
Investing in gold as an investment vehicle might seem like a very risky proposition these days. Many people believe that investing in gold is not profitable. This belief is due to the fact that many people see gold prices dropping because of the global economy. They believe they would lose their money if they invested gold. In reality, however there are still many significant benefits to gold investing. Here are some examples.
The oldest form of currency known to mankind is gold. There are records of its use going back thousands of years. It was used by many people around the globe as a currency store. Even today, countries such as South Africa continue to rely heavily on it as a form of payment for their citizens.
When deciding whether to invest in gold, the first thing you need to do is to decide what price per gram you are willing to pay. The first thing you should do when considering buying gold bullion is to decide how much you will spend per gram. You could contact a local jeweler to find out what their current market rate is.
Noting that gold prices have fallen in recent years, it is worth noting that the cost to produce gold has gone up. The price of gold may have fallen, but the production costs haven’t.
You should also consider the amount of your intended purchase when considering whether you should buy or not. For example, if you only intend to purchase enough to cover your wedding rings, it probably makes sense to hold off on buying any gold. This is not a wise decision if you're looking to invest in long-term assets. If you sell your gold for more than you paid, you can make a profit.
We hope this article helped you to gain a better appreciation of gold as a tool for investment. It is important to research all options before you make any decision. Only after doing so can you make an informed decision.
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By: Jamie Redman
Title: Cathie Wood Endorses Bitcoin ‘Hands Down’ Over Gold and Cash, Foresees Deflationary Economy
Sourced From: news.bitcoin.com/cathie-wood-endorses-bitcoin-hands-down-over-gold-and-cash-foresees-deflationary-economy/
Published Date: Mon, 06 Nov 2023 22:30:31 +0000
