No one can say where or when the next financial bubble will occur, but in the meantime, Nobel Prize-winning economist Richard Thaler says he’s avoiding making a investment: bitcoin.
Thaler, sometimes called the “father of behavioral economics,” is an open skeptic of bitcoin. Thaler told Stephen Dubner that, when it comes to investing, he follows billionaire investing mogul Warren Buffett’s simple advice.
“Warren Buffett says a lot of smart things, and one of the things he says is, don’t make investments in things you don’t understand,” Thaler says. “And I have no clue when it comes to bitcoin.”
Bitcoin is just one of many forms of cryptocurrencies that are used as digital currency and are accepted by a select amount of businesses and merchants. Bitcoin is also currently the world’s most valuable virtual currency by market value, trading at more than $6,700.
“I don’t know why anyone engaged in strictly legal activities would want to use a currency that is so volatile,” Thaler says.
