Doc's Daily Commentary

Mind Of Mav

No Company Can Fail

We’ve previously covered the term Moral Hazard here, which occurs when an entity has an incentive to increase its exposure to risk because it does not bear the full costs of that risk. In today’s terms, that means corporations being bailed out by governments.

For example, six months ago if anyone told you that Hertz, a 102-year-old car rental firm, was going to declare bankruptcy a few months later, you’d probably laugh them out of the room.

Sure, Hertz was a ticking time bomb — holding over $14 billion in securitized debt and struggling to compete with the likes of Uber and other ride-hailing services — but the “zombie” car company survived in the cheap money era, issuing new debt to pay off existing liabilities at zero interest rates.

This practice enabled Hertz — and many other zombie corporations — to survive for much longer than the rules of capitalism usually permitted. That was until COVID-19 locked down the global economy, wiping out all of Hertz’s revenue, forcing the company to declare bankruptcy thereafter.

Market disruption leads to market dissolution, right?

Common sense dictates that zombie companies will inevitably be smote upon the altar of their bad decisions by the guiding hand of the market.

And yet . . .

Despite insolvency, declining fundamentals, and the U.S. Bankruptcy Code stating that all debts must be repaid before stockholders receive anything, Hertz’s share price has risen to levels higher than before they announced bankruptcy.

In other words, 2 + 2 = 5.

How could this happen? Why is the stock not at zero?

Once again, let me introduce to you the power of moral hazard:

Unlimited bailouts sponsored by the Federal Reserve and the U.S Treasury. The Fed has increased its balance sheet by $4.5 trillion in the past month alone, and the US Treasury has been assisting companies via a $2.3 trillion relief package passed by Congress.

Remember the TARP bank bailouts of 2008? They are child’s play compared to the government’s response to COVID-19. 

Despite what common sense dictates, the Fed’s playbook says otherwise: No stock, mortgage, junk bond, or any other Wall Street security must go to zero.

The gargantuan amount of liquidity that authorities are pumping into the financial system continues to fuel craziness within markets. Hertz, as it turns out, is just the tip of the iceberg.

Even the greatest steaming pile of financial excrement will not be allowed to fail anytime soon. In fact, right now, its providing investors with triple-digit percentage returns.

It makes you think: why have an investing process when you can buy a bankrupt car rental company and make 100%, or buy a fraudulent coffee chain and make 400%? And all in a day’s work.

Why even consider investments with stable fundamentals anymore? Government bonds or defensive stocks like Walmart, Kroger, or GSK are boring. It’s time to speculate on frauds and bankruptcies instead. What could possibly go wrong?

As the Fed’s printing press goes “brrrr, brrrr, brrrr”, firing on all cylinders, and the Trump Administration pledges to bail out anyone and anything, we will continue to witness the most bizarre, most outrageous stock market activity on a daily basis: Robinhood investors posting 1000% gains with their stimulus cheques, bankruptcies and frauds yielding triple-digit returns, and short-sellers blowing up as “dogsh*t wrapped in catsh*t” rallies 10, 50, 100 percent in their face.

What we’re experiencing is the craziest market environment of all time, something we’ll never witness again, not until the next bubble-induced euphoria.

These conditions will not last forever, of course, but while they do, investors embracing insanity will profit and investors clinging onto economic reality will feel the burn . . .

The ReadySetCrypto "Three Token Pillars" Community Portfolio (V3)


Add your vote to the V3 Portfolio (Phase 3) by clicking here.

View V3 Portfolio (Phase 2) by clicking here.

View V3 Portfolio (Phase 1) by clicking here.

Read the V3 Portfolio guide by clicking here.

What is the goal of this portfolio?

The “Three Token Pillars” portfolio is democratically proportioned between the Three Pillars of the Token Economy & Interchain:

CryptoCurreny – Security Tokens (STO) – Decentralized Finance (DeFi)

With this portfolio, we will identify and take advantage of the opportunities within the Three
Pillars of ReadySetCrypto. We aim to Capitalise on the collective knowledge and experience of the RSC
community & build model portfolios containing the premier companies and projects
in the industry and manage risk allocation suitable for as many people as

The Second Phase of the RSC Community Portfolio V3 was to give us a general idea of the weightings people desire in each of the three pillars and also member’s risk tolerance. The Third Phase of the RSC Community Portfolio V3 has us closing in on a finalized portfolio allocation before we consolidated onto the highest quality projects.

Our Current Allocation As Of Phase Three:

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The ReadySetCrypto "Top Ten Crypto" Community Portfolio (V4)


Add your vote to the V4 Portfolio by clicking here.

Read about building Crypto Portfolio Diversity by clicking here.

What is the goal of this portfolio? 

The “Top Ten Crypto” portfolio is a democratically proportioned portfolio balanced based on votes from members of the RSC community as to what they believe are the top 10 projects by potential.
This portfolio should be much more useful given the ever-changing market dynamics. In short, you rank the projects you believe deserve a spot in the top 10. It should represent a portfolio and rank that you believe will stand the test of time. Once we have a good cross-section, we can study and make an assessment as to where we see value and perhaps where some diamonds in the rough opportunities exist. In a perfect world, we will end up with a Pareto-style distribution that describes the largest value capture in the market.
To give an update on the position, each one listed in low to high relative risk:
SoV/money == BTC, DCR
Platforms == ETH, XTZ
Private Money == XMR / ZEC / ZEN
DeFi == MKR / SNX and stablecoins
It is the most realistic way for us to distill the entirety of what we have learned (and that includes the RSC community opinion). We have an array of articles that have gradually picked off one by one different projects, some of which end up being many thousands of words to come to this conclusion. It is not capitulation because we all remain in the market. It is simply a consolidation of quality. We seek the cream of the crop as the milk turns sour on aggregate.

Current Top 10 Rankings:



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