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Why the panic about cryptocurrencies?

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Why the panic about cryptocurrencies?

Thursday, February 14th, 2019

With cryptocurrencies being a relatively new phenomenon, it’s understandable that those who are yet to learn the ins and outs might approach them with a sense of scepticism. After all, any financial undertakings should be approached with a certain degree of caution, and with a solid understanding of the processes and the risks that come along with them.

With traditional currencies, since the departure from the gold standard, we rely on governments and central banking authorities to assign value to the denominations we use for trade. It’s a system that has worked for us up until this point with no need for an alternative, and it works because we trust in the ledgers keeping track of our transactions by banks across the world.

Where people generally feel at unease with cryptocurrencies is that the ledgers which track our transactions are replaced by a decentralised, anonymous, digital blockchain. Central banking authorities and governments are replaced by advanced algorithms which act as guarantors for the money. In theory, this isn’t anything new as we’ve happily put our trust in such algorithms to keep our chip and pin cards and our passwords secure in the past. Using independent blockchains, separate from a central authority which can hold a monopoly, allows transactions to take place not only more quickly, but also more cost efficiently.

Cryptocurrencies are no different from traditional currencies in that there are people out there who take the opportunity to commit fraud. One particular highly publicised example was from Australia in 2017, when AUD $2.1million losses were reported as being due to cryptocurrency fraud. Although this number is not to be discounted, the total losses attributed to fraud overall were AUD $340million so, in reality, less than 1% of all reported fraud was related to cryptocurrency.

We’re hardwired to fear change and be sceptical of new developments, and we’re much more likely to hear about isolated incidents of fraud than the masses of generally safe transactions. That being said, if you do decide to start using cryptocurrencies, make sure you’re sufficiently protected so you don’t find yourself in the position of one of the unlucky few who fall victim to fraud.

What does Warren Buffett read?

Thursday, January 3rd, 2019

Warren Buffett, the famous American investor, speaker and philanthropist attributes his success to reading. An Investing student once asked him what the key was and he pointed to a pile of books and said, ‘Read 500 pages every day – that’s how knowledge works, it builds up like compound interest.’

His favourite books range from economist John Maynard Keynes’ classic Essays in Persuasion to former U.S. Treasury Secretary Timothy Geithner’s Stress Test, which offers some fascinating reflections on some of the financial crises over the last ten years.

Following Buffett’s example, a book always makes a great present. It shows you’ve thought about the person, their interests and what you think they might enjoy.

Of course, there are lots of bestsellers out there; fiction, crime, fantasy but there are also some fascinating non-fiction titles too. If you’re buying for someone who’s in business, the books we’ve highlighted below may be particularly relevant. You may also find them of interest yourself.

So here are some top tips from the ‘smart thinking’ category:

Timekeepers by Simon Garfield

This is an engaging look at the way our lives have become dominated by time and the way technology is making everything faster and faster. Garfield examines our obsession with time and our desire to measure it and control it. You may identify with the ‘cauldron of rush’ of modern-day life.

Unlearning Leadership – Guy Bell

The subtitle of this book is ‘Know yourself – Grow your Business’. Bell challenges businesses that put shareholder value before their people, showing that companies which do so often have poor results. Instead, he encourages empathetic leadership and transformative thinking.

The Motivation Trap – John Hittler

If you’re a manager or in some other sort of leadership role, how do you keep your team motivated? Hittler unwraps some of the underpinnings of motivation, explores its limitations and shows when it can be an effective tool, based on his years of coaching experience.

The Power of Habit – Charles Duhigg

Why do we do what we do? How can we change? This is an intriguing insight into what prompts behaviour from exercise to weight loss, market disruption to social revolution and what leads to success.

There you have our recommendations. Happy Book Buying or Happy Reading!