Cramer's View on Bitcoin
Jim Cramer, the host of CNBC's Mad Money show, recently expressed his opinion on bitcoin. He acknowledged that bitcoin is a technological marvel that cannot be killed and emphasized that people need to recognize that it's here to stay. However, he also stated that he believes bitcoin is topping out.
Crypto Market Surge
Cramer's remarks came after a significant surge in the crypto market, with bitcoin surpassing $47,000 on Monday. The market optimism is driven by the potential approval of spot bitcoin exchange-traded funds (ETFs) by the U.S. Securities and Exchange Commission (SEC).
Bitcoin vs. Stocks
When asked about stocks like Riot Platforms and Marathon Digital, Cramer advised investors to buy bitcoin directly if they want exposure to it. Many investors opt for stocks of companies associated with cryptocurrencies or with significant exposure to bitcoin as an indirect approach. Besides Riot Platforms and Marathon Digital, other popular choices include Microstrategy and Coinbase.
In the crypto world, the "Cramer effect" has become a popular meme. It is observed that bitcoin often behaves opposite to Cramer's predictions. If he is bullish, a bearish swing is expected, and vice versa. Following Cramer's statement about bitcoin topping out, some users expressed optimism, with one saying, "We're going to the moon." Another user mentioned that bitcoin reaching $500,000 is coming.
Cramer's History with Bitcoin
Cramer was once a bitcoin supporter and even recommended a 5% portfolio allocation to BTC in March 2021. However, he later divested his holdings due to ransomware concerns and China's mining crackdown. Cramer then disclosed an investment in ether (ETH) but raised concerns about Binance, FTX, and Tether. Ultimately, he advised investors to exit the crypto market, anticipating SEC actions against non-compliant crypto firms.
Jim Cramer's statement about bitcoin topping out has sparked discussions in the crypto community. While he believes that bitcoin is reaching its peak, he also recognizes its technological significance and longevity. The future of bitcoin and its market performance remain uncertain, and investors should consider various factors before making any investment decisions.
What are your thoughts on Jim Cramer's statement about bitcoin? Let us know in the comments section below.
Frequently Asked Questions
What precious metal should I invest in?
This depends on what risk you are willing take and what kind of return you desire. Although gold has been considered a safe investment, it is not always the most lucrative. If you are looking for quick profits, gold might not be the right investment. Silver is a better investment if you have patience and the time to do it.
If you don't care about getting rich quickly, gold is probably the way to go. However, silver might be a better option if you're looking for an investment that provides steady returns over long periods.
What amount should I invest in my Roth IRA?
Roth IRAs are retirement accounts where you deposit your own money tax-free. The account cannot be withdrawn from until you are 59 1/2. However, if your goal is to withdraw funds before that time, there are certain rules you must observe. First, your principal (the deposit amount originally made) is not transferable. No matter how much money you contribute, you cannot take out more than was originally deposited to the account. If you take out more than the initial contribution, you must pay tax.
You cannot withhold your earnings from income taxes. Withdrawing your earnings will result in you paying taxes. Let's suppose that you contribute $5,000 annually to your Roth IRA. Let's also say that you earn $10,000 per annum after contributing. On the earnings, you would be responsible for $3,500 federal income taxes. This leaves you with $6,500 remaining. The amount you can withdraw is limited to the original contribution.
So, if you were to take out $4,000 of your earnings, you'd still owe taxes on the remaining $1,500. Additionally, half of your earnings would be lost because they will be taxed at 50% (half the 40%). So, even though you ended up with $7,000 in your Roth IRA, you only got back $4,000.
There are two types if Roth IRAs: Roth and Traditional. Traditional IRAs allow for pre-tax deductions from your taxable earnings. Your traditional IRA can be used to withdraw your balance and interest when you are retired. You have the option to withdraw any amount from a traditional IRA.
Roth IRAs don't allow you deduct contributions. However, once you retire, you can withdraw your entire contribution plus accrued interest. There is no minimum withdrawal amount, unlike traditional IRAs. It doesn't matter if you are 70 1/2 or older before you withdraw your contribution.
How to Open a Precious Metal IRA
It is important to decide if you would like an Individual Retirement Account (IRA). Open the account by filling out Form 8606. Next, fill out Form 5204. This will determine the type of IRA that you are eligible for. This form should be completed within 60 days after opening the account. Once you have completed this form, it is possible to begin investing. You can also choose to pay your salary directly by making a payroll deduction.
Complete Form 8903 if your Roth IRA option is chosen. Otherwise, the process will be identical to an ordinary IRA.
To be eligible for a precious metals IRA, you will need to meet certain requirements. The IRS says you must be 18 years old and have earned income. Your earnings cannot exceed $110,000 per year ($220,000 if married and filing jointly) for any single tax year. And, you have to make contributions regularly. These rules apply whether you're contributing through an employer or directly from your paychecks.
A precious metals IRA can be used to invest in palladium or platinum, gold, silver, palladium or rhodium. However, you can't purchase physical bullion. This means that you will not be allowed to trade shares or bonds.
However, there are two significant drawbacks to investing in precious metals via an IRA. First, they are not as liquid or as easy to sell as stocks and bonds. It is therefore harder to sell them when required. Second, they are not able to generate dividends as stocks and bonds. Therefore, you will lose more money than you gain over time.
How do you withdraw from an IRA that holds precious metals?
First, you must decide if you wish to withdraw money from your IRA account. You should also ensure that you have enough money to cover any fees and penalties associated with withdrawing funds.
Consider opening a taxable brokerage instead of an IRA if it is possible to pay a penalty if your withdrawal is made before the deadline. This option is also available if you are willing to pay taxes on the amount you withdraw.
Next, you'll need to figure out how much money you will take out of your IRA. This calculation depends on several factors, including the age when you withdraw the money, how long you've owned the account, and whether you intend to continue contributing to your retirement plan.
Once you know how much of your total savings to convert to cash, it's time to choose the type of IRA that you want. While traditional IRAs are tax-free, Roth IRAs can be withdrawn at any time after you reach 59 1/2. However, Roth IRAs will charge income taxes upfront and allow you to access your earnings later without additional taxes.
Once the calculations have been completed, it's time to open a brokerage accounts. Many brokers offer signup bonuses or other promotions to encourage people to open accounts. To avoid unnecessary fees, however, try opening an account using a debit card rather than a credit card.
When it's time to make withdrawals from your precious-metal IRA, you'll need a place to keep your coins safe. Some storage facilities will take bullion bars while others require you only to purchase individual coins. You'll have to weigh the pros of each option before you make a decision.
For example, storing bullion bars requires less space because you aren't dealing with individual coins. But, each coin must be counted separately. You can track their value by keeping individual coins.
Some prefer to store their coins in a vault. Others prefer to store their coins in a vault. Whichever method you choose, make sure you store your bullion safely so you can enjoy its benefits for years to come.
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- You can only purchase gold bars at least 99.5% purity. (forbes.com)
- If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal, so you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (forbes.com)
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.com)
- The price of gold jumped 131 percent from late 2007 to September 2011, when it hit a high of $1,921 an ounce, according to the World Gold Council. (aarp.org)
- 7 U.S. Code SS7 – Designation boards of trade as contract market authorities
- 26 U.S. Code SS 408 – Individual retirement accounts
- Yahoo Finance – Barrick Gold Corporation Stock Price, News & Quote – Barrick Gold Corporation (GOLD).
How to Buy Physical Gold in An IRA
The easiest way to invest is to buy shares in companies that make gold. However, this method comes with many risks because there's no guarantee that these companies will continue to survive. Even if they survive, there's always the risk that they will lose money due fluctuations in gold prices.
An alternative option would be to buy physical gold itself. This means that you will need to open an account at a bank, bullion seller online, or purchase gold from a trusted seller. The advantages of this option include the ease of access (you don't need to deal with stock exchanges) and the ability to make purchases when prices are low. It is easier to view how much gold has been stored. So you can see exactly what you have paid and if you missed any taxes, you will get a receipt. There's also less chance of theft than investing in stocks.
However, there are some disadvantages too. For example, you won't benefit from banks' interest rates or investment funds. You won't have the ability to diversify your holdings; you will be stuck with what you purchased. The taxman might also ask you questions about where your gold is located.
BullionVault.com offers more information on buying gold for an IRA.
By: Kevin Helms
Title: Jim Cramer Says Bitcoin is Topping Out, but It's Here to Stay
Sourced From: news.bitcoin.com/mad-money-host-jim-cramer-says-bitcoin-is-topping-out/
Published Date: Wed, 10 Jan 2024 03:30:36 +0000