Seeking Alpha

Quentin Stephen...'s  Instablog

Quentin Stephens Jr.
Send Message
I am a Midwesterner who enjoys discussing anything that has the potential to create wealth. I am a person that is extremely concerned with my time allocation and it is a goal of mine to have greater control over my time than an employer.
View Quentin Stephens Jr.'s Instablogs on:
  • Shortcomings In The World Of Business & Finance Before Bitcoin

    Great Depression Bank Crash. Savings & Loan Crisis. Mortgage Crisis. Bernie Madoff Hedge Fund Ponzi Scheme. Enron. MF Global. Mt. Gox.

    Searching the above terms online you will notice that the following all have one thing in common. Financial losses were incurred in each case. In the case of banks crashing during the great depression and the life savings of many Americans vanishing, the answer was not to make banks illegal due to financial losses, instead it led to the creation of the Federal Deposit Insurance Corporation (FDIC) to protect against a situation like this occuring in the future. Another example in the banking sector is the Savings & Loan Crisis of the 1980's and early 1990's where huge financial losses were apparent. The government's response was not to kill off savings and loans companies but to provide additional oversight and regulation to monitor them closely in order to prevent this horrible financial situation from happening again.

    Given that the mortgage crisis is relatively fresh and had been covered vastly in the news media, great detail will not be given to this. What will be said is that many Americans we now know were given incredibly bad deals with these mortgages. However, the concept of mortgages in America were not abolished. Different policies were formed for the purpose of protecting the consumer.

    The 55 billion dollar Ponzi Scheme the was run by Bernie Madoff did not cause any senators to say that we need to ban every hedge fund in the industry due to the infractions of one individual. There was no guilty by association in this scenario. The wealthy continue to use hedge funds and probably even more now than when Madoff engaged in his chicanery.

    Enron. Take a minute and think about how many employees who worked for Enron lost their life saving by investing in the company that they worked for. There were no government warnings to people telling them to be careful about the money they invest with companies that they work for. Enron was treated as an isolated event, the exception rather than the rule.

    Before Mt. Gox is discussed MF Global will be mentioned. MF Global was a commodities brokerage that got into trouble for having customer funds in a place where it had no business being. Luckily customers were able to receive most of their money back. The point is that commodity brokerages were not outlawed simply because of the iladvised decisions of MF Global.

    At this point in time those running Mt. Gox are the equivalent to camel feces. The issues that they claim to have had were ongoing for years however the truth did not come out until over 300 million dollars worth of Bitcoin were missing. This is just an opinion and it could be wrong, which is the belief among people in Bitcoin circles that the missing Bitcoins may have been fleeced from within Mt. Gox.

    Journalistic Laziness & Ineptitude on the Subject of Bitcoin

    No, Journalist the failure of one exchange is not the end of cryptography. If anything it is still in its infancy and over time birth will be given to bigger and better things within the subject matter. Giving gloom and doom headlines does grab the attention of readers in the ever so dying newspaper business, however it does a disservice to cryptography technology by stoking public fear and doing very little to educate the public on what this actually is. When discussing Bitcoin, a guilty by association approach is used which is a stupid thing to do. Just like you cannot slander another company due to Target's data breach, MF Global's co-mingling of customer funds, nor can you blame every hedge fund on Wall St. due to the criminal acts of Bernie Madoff. That would be completely nonsensical. However within journalism that is what is currently being done with Bitcoin and it is actually accepted. Please speak not of what you do not know, educate yourself and inform others as to what will exist in our future.


    Bitcoin is imperfect just like many monetary systems around the globe. The only difference is that there is no Bitcoin Central Bank to print coins whenever there is a man-made crisis. Moving Bitcoin and other crypto-currencies forward there will be obstacles, setbacks, and many learning experiences that will have to take place to move this world changing concept onward. What does not help is when those who are uninformed write things that purposely try to discredit Bitcoin which sounds rather foolish to those who are truly informed. Getting involved in Bitcoin is risky and the public should be made aware of it. However, when you try to connect Bitcoin to organized crime and money laundering then that right there is slanderous considering fiat currency is used to launder money and no one is discussing getting rid of it. In the end who this really hurts is not those in places that have access to banks at their finger tips. Attempting to discredit virtual currency and its progress hurts the more than 2.5 billion people globally that lack access to banks. This is a rather fascinating concept and technologically revolutionary. If you believe in the laws of free market then embrace Bitcoin.

    Donate Bitcoin: 12Bq2ontVqdMiBA99oLN4jFdsBFnjpV4uw

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

    Tags: long-ideas
    Mar 02 7:19 AM | Link | Comment!
  • Twitter: A Masterpiece Of Minimalism

    Investing in Twitter (TWTR)? No Thank You

    When potential investors read articles regarding Twitter, what they mostly see are graphs and charts that they could find anywhere on the internet. However, what we don't see is a common sense approach to why investing in Twitter at this juncture is a terrible gamble. There are three key things that will be discussed in order to enlighten you and to bring a different perspective to the table in order to show why Twitter is likely an unwise investment for most.


    Facebook (NASDAQ:FB) investors, employees and ex-employees patiently waited for Facebook to go public in order to get paid. In 2004, early Facebook investor Peter Thiel who invested $500,000 in the company profited to the tune of 1 billions dollars after the company went public. In this situation an investor that had been invested in Facebook for 8 years sold his stock in the company. Or for the employees and ex-employees many of whom may have been underpaid in exchange for being able to get stock in the company, many of them liquidated their shares when they became unrestricted. Can you blame them?

    A. Repeat of History?

    "Early Twitter Investors Poised To Cash In," read one headline. Can you blame them? Now take a moment to look up related search terms regarding Facebook early investors which should cause you to make a mental note of one of many similarities. In the case of Twitter, early investors Union Square Ventures, Benchmark, Spark Capital are all expected to make a fortune off of the Twitter Initial Public Offering (NYSEARCA:IPO) if they haven't done so already. When you have different companies that have been invested in Twitter as long as 7 years they are going to likely liquidate their position by running to the nearest exit like in the case of Facebook. On February 15th, 2014 is the earliest time in which Twitter will permit its employees and ex-employees to sell their stock in the company. My hunch is that as more and more shares of Twitter become unrestricted the stock will decline as did Facebook when its employees gained the freedom to sell their shares. Analyst like to compare and contrast the business models of Facebook and Twitter regularly but ignore similarities like this that maybe of importance to the investor on Main Street.

    2. 7 Years of Zero Profit

    Since the founding of Twitter in 2006 they have never turned a profit. Year after year money has been invested in Twitter with not one cent of gain. By my observation this company appears to be nothing but a money pit. Do you agree? Every article that I have read list reasons to invest in Twitter but have been unable to say anything convincing other than to say, "Twitter has a lot of potential." or "its membership is growing." There needs to be a greater threshold that a company must meet other than having a lot of potential if they truly want to be worth over $20 billion dollars. Again, we are talking about $20 billion dollars. Twitter appears to be a company that was created with one great idea but lacks the vision of Steve Jobs or dare I say Mark Zuckerberg.

    3. How I One Day See Twitter

    I one day see Twitter as a pager or a 1980's Gordon Gekko cellular phone, unattractive and useless but once played a more prominent role in society. I one day see Twitter as a Blockbuster Video, a relic of a bygone era. I one day see Twitter like Netscape, totally and utterly irrelevant. Ultimately, you must discover why you may or may not want to risk your capital on Twitter. With new technology being developed at an increasingly fast rate you must asked yourself if you will continue seeing the usage of Twitter remain at the same rate or higher over the next 10 years? None of it is sustainable. Do you really believe that a child that is currently 5 years old will be utilizing Twitter in 20 years? Hell no. They will only wonder, "what is a Twitter?"


    Not all that glitters is gold. Not every company with a market capitalization in excess of 20 billion is really worth 20 billion. I believe Twitter is a "moment in time" company instead of a company that stands the test of time. Over the next few years I do see day-traders profiting from the volatility Twitter is likely to have. One would be foolish to hold this over the long term. Early investors and employees have made or plan to make their money on the stock after the restriction period ends. With that said, over the long term retail investors and pension funds for example will get slaughtered for coming late to the party.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

    Tags: TWTR
    Dec 05 6:28 AM | Link | Comment!
Full index of posts »


More »
Posts by Themes
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.