Certificates of Deposit with a 38% APY. Yeah, right.

Crypto nuttiness is going to end, probably soon. And with a bang, not a whimper. I encountered the sign pictured above touting a 38% APY on a walk in my neighborhood. It reminded me why collapse is inevitable. The flashing red lights are economic, historical and technical.

Epic Bubble or Distributed Ponzi Scheme?

The first and most obvious reason for the impending demise of crypto—and its bastard offspring, NFTs (non-fungible tokens)–is that they are the biggest speculative bubble since Dutch Tulip mania. Like tulips, bitcoins and other forms of crypto currency have no intrinsic value. They are not gold or pork bellies nor backed by the good faith and credit of any government. A sane person should be wary when multiple prominent economists, including multiple Nobel prize winners, say cryptocurrency has no intrinsic value whatsoever. One explains:

“It’s better if you’re a criminal, I don’t know why else.”

“The only advantage as far as I can see is you can be a crook,” he said. “You don’t want to leave any record. It’s not an accident that people who demand ransoms demand them in bitcoin. I’m not sure anyone else does.

Crypto is the biggest current example of the Greater Fool Theory. It’s based on the idea that you can make a profit even on a worthless asset, if you can only find someone else stupid enough to buy it. As noted by someone who should know, crypto and NFTs are “100% based on greater fool theory.”

I and as well as people who know much more than I about the underlying technology consider the crypto mania phenomenon to be a sort of distributed Ponzi scheme. There’s no central person or organization running the scam, just many people acting independently. Some people do make money on Ponzi schemes, but even if there is no actual fraud, losing your shirt is more likely.

Of course, when actual fraud is involved, you will lose your shirt even faster. The Federal Trade Commission reported that since the start of 2021, Americans have lost more than $1 billion to cryptocurrency scams, nearly 60 times the losses reported in 2018.

How can you identify a Ponzi scheme? A useful Wikipedia article provides some examples, including their tendency to “use vague verbal guises such as ‘hedge futures trading,’ ‘high-yield investment programs’, or ‘offshore investment’ to describe their income strategy.

Given this history, is it surprising that this particular crypto vendor advertisement guarantees “Immutable Code with 100% Uptime”? Most likely no one investing in this product understands what that is supposed to mean, let alone the technical aspects of the blockchain. It’s all just technobabble to them.

Why are so many otherwise intelligent people willing to buy into the bubble? A Financial Industry Regulatory Authority (FINRA) advisory provides a clue as to one reason: “[t]he con artists behind [HYIP-type Ponzi schemes] are experts at using social media — including YouTube, Twitter and Facebook — to lure investors and create the illusion of social consensus that these investments are legitimate.”

One interesting aspect of the crypto puzzle is that a significant number of the investors understand and tacitly admit that their investments are fundamentally unsound and fragile. They just believe they are so smart they won’t get hurt. They frequently explain “Crypto is a great investment, you just have to know when to get out.” Of course, this is just an implicit admission that they are relying on finding a greater fool just before the bubble collapses. It’s a form of personal fable, labeled by Psychology Today as Narcissism and the Myth of Invincibility.

There is another reason why so many people are vulnerable to the crypto scam: The power of wishful thinking. People see what they want to see, believe what they want to believe. When someone tells us there’s an easy way we could make a lot of money, there’s a tendency to convince yourself that what they are saying isue.

This ties into another fascinating aspect of the crypto scene. Significant number of investors who have been defrauded or otherwise lost large sums of money stubbornly continue to defend the scammers. A Michelle Singletary column quoted a classic example:

“I took out at least four loans from different banks to make sure the dream he was talking about, as a family, we were ready,” Victorin said. He still has faith in Alexandre.

“We believe in this guy,” Victorin said. “We believe in our CEO. He is a good guy, a great guy. And we never met somebody like that, very down-to-earth, very respectful, transparent with a lot of charisma.

I’m sure many crypto vendors have lots and lots of “charisma.”

We’ll go into more detail in later articles to explain the historic and technical reason for the impending demise of crypto, including the facts that:

  • “Unbreakable” encryption techniques (the basis for crypto) have historically proven to be quite breakable, and
  • Quantum computers will eat crypto for breakfast

Posted in our “Off the Clock” category:

Very glad to have my article Pitching the Difficult Case: Working With Prosecutors published recently at LLRX.com.

The subject is related criminal prosecutions, an area of substantive law that I worked in at my pre-retirement “day job” working as counsel to inspectors general at multiple federal agencies. It deals with what I consider to be a key topic: How criminal investigators can work most effectively with prosecutors.

This new article contains more advanced ideas than The Art of the Referral, the article I co-authored previously with Bruce Sackman and Kelly Sisario. I hope it is as successful as the first article, which has been used as training material at the Federal Law Enforcement Training Center and the highly ranked John Jay College of Criminal Justice.

Which is better for lawyers, Facebook or LinkedIn? Kevin O’Keefe shares his opinion — fittingly enough, on Facebook. My view? A Facebook presence is essential, since it is the way many potential clients would find you, but Facebook is probably a significant marketing channel for only a few lawyers with particular personalities or niches.

Gyi Tsakalakis and Conrad Saam have some good observations about link-building in their Lunch Hour Legal Marketing podcast. Not exactly new if you have been working in this area, but will be super useful to many. Couple of highlights:

  • Internal links (a hypertext link to another part of your website) matter. Look for chances to use them.
  • Anchor text (the clickable part of a hypertext link) matters. Anchor text that says “click here” is useless.

Many presenters dread the challenge of dealing with hostile or otherwise difficult questions. Some questioners have a personal agenda, or simply enjoy embarrassing a presenter. With experience, I eventually came to enjoy the challenge of dealing with difficult questioners. The presenter who stays calm and remembers a few simple techniques can nearly always hold their own, or better, in such encounters.

Approach the task with confidence. Let the audience see you are confident and calm. If you become defensive or argumentative it tends to legitimize the hostile questioner. The audience will tend to side with you if you remain gracious and polite.

Never give the appearance of being disrespectful toward an audience member. This will deaden the crowd, making others less likely to contribute. It will also make audience members (who tend to identify with their peers in the group) resent you.

Use a strategic pause. Some presenters have been known to gain a little extra time to compose themselves or prepare to answer a particularly difficult question by taking a drink of water or referring to their notes.

Acknowledge the possibility of different viewpoints. A response like this will often work wonders: “Thank you for expressing your view” [so articulately–if that is true]. I know that others have come to different conclusions on this issue. I am telling you what has worked for me [or most people].”

Give ground when appropriate. If there is or appears to be some validity to the questioner’s position, acknowledge it readily. For example, if someone is complaining about the time needed to compile records for financial disclosure purposes, acknowledge that it can be a burden. Failure to acknowledge the obvious will cause you to look out of touch or unreasonable. However, be firm in defending the ground you must defend.

Direct your attention appropriately. Treat the questioner like they are the most important person in the world while they are speaking, but when you respond, orient your body language and eye contact toward the group as a whole. In jury trials I consciously try to direct most of my attention not toward the judge, but the jury. There is nothing you could say that would satisfy every questioner with a chip on their shoulder. Direct your attention toward the audience that matters.

Prepare for predictable difficult questions. Sometimes you can predict troublesome questions. This gives you the option to preempt the question by raising it yourself during your presentation. This can take the sting from the issue.

Consider preparing  just-in-case slides. For important presentations, or ones I will be giving multiple times, I sometimes prepare slides to assist in answering the most important questions I anticipate. Wasted effort if no one asks the question? Sure, but when you happen to have just the right slide for a difficult question, it can make a palpable impression on an audience. Knowing you have just the right slide in reserve is a big confidence builder as well.

Offer to meet with the questioner after the presentation. This will discourage troublemakers who crave the attention of the audience.

Offer to research the issue and provide an answer. This is not the most original technique but it has its advantages, including giving the audience a reason to visit a site you want them to visit. This could be your LinkedIn account, your blog or even a publicly accessible Facebook post.

Use Empathy + Objectivity. A powerful tool for dealing with emotional, angry questioners is what I call the Empathy + Objectivity formula. It works like this:

Step 1: Begin your answer by acknowledging the questioner’s emotions, something like… ”Nearly anyone in your position would feel the same way…”

Step 2: Conclude your answer by providing an objective assessment of the situation. For example, if you are training government employees on the legal requirement to file financial disclosure forms you can expect angry attacks from those who view the requirement as an unwarranted intrusion into privacy. You might respond something like this:

“I understand why people might feel that way. However, Congress created the Office of Government Ethics to establish a uniform approach, and this is what OGE came up with. It’s a known condition of government employment, and if we want to work for the Executive Branch, we have to deal with it. I’d be glad to talk with you after this presentation if you like.”

Know when to turn a question back on the audience – and when not to. Some public speaking books recommend that a presenter who is stumped by a difficult question should ask the audience to proffer an answer. This makes a lot of sense in some situations. If you are a lawyer teaching a group of other lawyers in your organization, you may be more of a peer than an authority figure.

In other settings, the reverse-the-question technique is dubious. In some situations the presenter is supposed to be the expert, the authority figure. Passing some types of questions to the audience can reduce the group’s respect for your expertise. In such situations it is usually better to respond with the time-honored gambit of offering to look up the answer.

Consider the use of question forms. Finally, the practice of providing “live” answers only to written questions is often a useful technique for dealing with questioners who have an agenda. You can answer at the public meeting only the questions you want to answer, and reserve questions with an agenda for the post-meeting follow-up. Establishing this policy and sticking to it is a powerful way of positioning yourself when hostile questions are expected. This technique can be powerful but requires some finesse to implement effectively, so I’ll be discussing it in a later article in this series.

This article originally appeared at LLRX.com.

Jer: “TikTok for Lawyers? Nope.”

Kevin: “TikTok is real.”

Jer: “Recalculating . . .”

Gotta rethink this one after reading Kevin O’Keefe’s newest take:

I can turn on the TV, the scheduled version of which is becoming antiquidated, and see news and interview shows. I get what the news producer produces and selects, without any knowledge of my interests.

Takes a lot of time to watch TV, with all the commercials, and I don’t see near as much as on TikTok. I like the TikTok format better as well.

TikTok users are watching TikTok, on average, 90 minutes a day. I’m far from that, but with my knowledge of how much TV (scheduled or streaming) Americans watch, much of it junk (in my opinion), I get the TikTok attraction.

I’m seeing lawyers, former presidents, interviews of musicians I respect, senators, entrepreneurs and others whose brief talks or interviews I enjoy.

This morning I saw a brief 60 Minutes’ interview with Billy Joel. An entertainer on a news show, both I enjoy, delivered in a brief and entertaining fashion – an interview I’d not have not seen but for TikTok.

TikTok is tailored video or television on one’s iPhone or iPad.

TikTok falls in the creator economy, verus the traditional media produced economy. I trust these “creators” as people and I trust and enjoy the informal format, as compared to the tradional.

Lawyers and law firms have shown that trust can be established with followers on the net. Whether it be blogging, YouTube, Twitter or Facebook, your trusted insight has allowed you to connect with your target audience.

As lawyers and law firms you now need to start studying TikTok, watching it, playing with it, and be ready to start using it.

TikTok is real.

OK, you have gotten through the body of your presentation satisfactorily. Time to relax, right? Nope. There is one hurdle left: The question and answer period. This is when some presenters wilt and others shine. With a few tips, some experience and a modest amount of intestinal fortitude, you can shine every time. Here’s how:

Anticipate questions. It’s usually easy for a well prepared speaker to anticipate likely questions. Take a little time to plan how you will approach the most difficult. Advance preparation gives you the option to pre-empt troublesome questions by addressing them yourself during the body of your presentation.

Set the ground rules. At the beginning of your talk tell the audience whether you will be taking questions, and if so, when. Taking questions only after you have finished speaking has much to recommend it.

Ask yourself the question you most want to answer. At the beginning of the Q & A period tell the audience: “People often ask [whatever].” This lets you start strong with an answer that will help you get your message out. Some speakers have been known to plant a question with a friendly audience member.

Maintain appropriate eye contact. Focus your attention on the questioner while she is speaking. Demonstrate engagement and respect. When answering the question shift your focus to the audience. This subtly draws the audience’s attention away from the speaker and toward you.

Repeat the question. In many venues audience questions will be inaudible to most attendees. Repeating the question also reduces the possibility of misunderstanding. A side benefit: Repeating the question can gain a few seconds to formulate your answer.

Ask the questioner to elaborate if the question is unclear. Restating the question can be an effective technique. Try paraphrasing it and asking the questioner if your restatement reflects her concerns.

Reflect before reacting. After repeating the question don’t be afraid to take a few seconds to think before you begin your answer. As noted by Garr Reynolds in The Naked Presenter (2011): It’s a conversation, not a race.

Avoid the trap of believing you must know the answer to every question. No one knows everything. Offering to look up the answer after the presentation is often the best approach. Some speech experts recommend that if you are stumped you should solicit answers from the audience. This is a good approach in some situations.

Compliment the questioner if deserved. Some speech instructors discourage the practice of complimenting an audience member for asking a good question. Their theory is that this will discourage other audience members from asking questions for fear theirs won’t be as good.

My experience has been exactly the opposite. I’ve gotten multiple benefits from complimenting good questions and use this technique frequently. I will sometimes even make a big deal of thanking the questioner for reminding me of such an important point. If handled well the compliment will serve to emphasize a key point I want to make: “Thank you! This is one of the most important questions that could be asked about this topic.”

Liberal use of compliments also tends to encourage other audience members to ask “good” questions, i.e., ones that will also earn the approbation of the authority figure in front of the room (you).

Embody brevity. Rambling, repetitive answers are one of the most common—and damaging—Q & A errors. Don’t squander the good impression you have worked so hard to create in the body of your presentation. Make the important points concisely and then shut up.

Respect questioners. Never inadvertently make a questioner feel ignorant or stupid. Also avoid disrespecting them more subtly by appearing to be bored or condescending in your answer.

Unless the questioner is blatantly a major league jerk the rest of the audience will identify with them, not you, so disrespecting a questioner is the functional equivalent of disrespecting the whole audience. Even if you wish you were somewhere else, you should strive to treat each questioner like she is star NPR interviewer Terry Gross and you are a guest on her show Fresh Air.

Match your demeanor to the question. Malcom Kushner provided some not-so-dumb advice in Public Speaking & Presentations for Dummies:

If someone is confused, be understanding.

If someone is blatantly offensive, be forceful and disapproving (without counterattacking).

If someone is seeking information, be professorial. Never lose control of yourself.

Know how to deal with a dead audience. No questions? Not a problem for the resourceful presenter!

  • Prime the pump by asking yourself a question, one whose answer will advance the purposes of your presentation.
  • Ask a question that an audience member asked you privately before your talk.
  • Break the ice by asking the audience questions: “How many of you think X? How many think Y”
  • Offer to answer questions privately. Some audience members may have questions they don’t want to expose to the group.

Do not let the Q&A session run late. This goes double if you are the last speaker before lunch or the last speaker of the day. In fact, end your presentation early if possible. This is one of many things I learned from the best presenter I’ve been lucky enough to work with, Greg Siskind. Invite those who still have questions to catch up with you after the formal session.

Finish strong. Questions all answered? No questions? Either way, whatever you do, don’t say something like, “Well, I guess that’s it” and creep off stage. Reiterate a key point you want to make and thank the audience for their attention.

This article appeared originally at LLRX.com.