I don’t know what’s going to happen to GameStop or AMC or DogeCoin tomorrow. (And anyone who tells you they do is either full of shit, trying to sell you something, or both). That’s what’s make it gambling. It’s just throwing your money on the table on a guess for short a term win. My advice to you about these things is the exact advice I would give if you were heading to a Vegas casino. I have no idea how to make money doing it. If you choose to, keep the stakes very low, and be suspicious of “big fish” stories you hear about people getting rich. At best it’s just selection bias (ignoring the millions of stories of people who lost their shirt on this nonsense) and at worse it’s misleading information in an attempt to move the market to profit someone else.
Speaking about that, let’s talk about DogeCoin. I first heard about DogeCoin many years ago. And let me be clear: DogeCoin is a joke. I’m not saying that to be derogatory about its prospects as an investment. That’s a matter of fact. It was literally created as a joke. Named after the internet meme doge (dog) who speaks in broken english.
At the time, bitcoin had become more mainstream and other cryptocurrencies were being created. A lot of them. At the moment, there are more than 4,000 cryptocurrencies out there. And as hype surrounds one or another, they can spike in value (then crash). In 2013 a couple of enterprising software engineers created DogeCoin. I imagine the conversation went like this: “How stupid do I think crypto consumers are? I bet we can make a joke coin and it will actually end up with real value”. Enter DogeCoin.
I hadn’t heard more about it for years, until the last 24 hours when everyone suddenly has a case of FOMO over this GameStop situation. I’ve seen some TikToks on DogeCoin that make me VERY uncomfortable. It reads to me like a pump and dump scheme designed to artificially (and temporarily) inflate the value of DogeCoin just long enough for the perpetrators to get out. Buying DogeCoin is not investing, it’s gambling.
As always, reminding you to build wealth by following the two PFC rules: 1.) Live below your means and 2.) Invest early and often.