Bitcoin: view it as a game for small children
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Bitcoin has value because many people think it has value. Of course, fiat money, like dollars, rupees and kwacha, also has value because many people think it has value, with an important disctinction - the government makes you pay taxes in that currency.
Cheers, Vikram.
Most of the currencies are backed by the value of the products a country creates - real things. Some countries even have gold reserves to be on the safe side...
"The only place where Success comes before Work is in the dictionary." Vidal Sassoon, 1928 - 2012
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Bitcoin has value because many people think it has value. Of course, fiat money, like dollars, rupees and kwacha, also has value because many people think it has value, with an important disctinction - the government makes you pay taxes in that currency.
Cheers, Vikram.
This. The post is basically solipsistic because all value is subjective. Nothing has intrinsic value. Everyone has their own subjective valuation for whatever is bought and sold. The interplay of all these valuations, of buyers and sellers, is what can be described by supply and demand curves, which find a market-clearing price. You could call this price an "intrinsic value", but there is nothing "intrinsic" about it because it is constantly changing. Many serious, professional investors are now into Bitcoin. Are they infallible? Hardly. So it'll be interesting to see how it plays out.
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The fox knows many things, but the hedgehog knows one big thing. -
This is actually a very good description of hyperinflation. When it occurred it Weimar Germany, the central bankers lamented that they couldn't print money fast enough! That was true, though it was their prior printing that caused the crisis. When confidence in a currency is lost, velocity goes to the moon because everyone spends their currency immediately, for anything of value, because prices will be higher tomorrow...tonight...a couple of hours from now.
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The fox knows many things, but the hedgehog knows one big thing.I was first vaguely aware of this as a child - my stamp collection had an unused stamp. It was overprinted (not worth new paper, I suppose) as 100 Million Reichsmarks. Excitement waned as I discovered how much it was not worth.
"The difference between genius and stupidity is that genius has its limits." - Albert Einstein
"If you are searching for perfection in others, then you seek disappointment. If you seek perfection in yourself, then you will find failure." - Balboos HaGadol Mar 2010
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Do you remember our Soapbox discussion, ~18 months ago? One frequent visitor said "I predict an imminent bitcoin crash." A few months later Bitcoin fell from $US 20K to 10K. So he said "Hah! Toldya!". Then it went down to 6K. Now Bitcoin is at 55K. I am not saying that Bitcoin is the best thins since sliced bread. I am saying Bitcoin is such a strange animal that nobody knows what it'll do next.
"If we don't change direction, we'll end up where we're going"
megaadam wrote:
nobody knows what it'll do next.
Call me skeptical, but I imagine some folks indeed know what it's going to do, and capitalize (to the detriment of others) on that knowledge/(control?).
"the debugger doesn't tell me anything because this code compiles just fine" - random QA comment "Facebook is where you tell lies to your friends. Twitter is where you tell the truth to strangers." - chriselst "I don't drink any more... then again, I don't drink any less." - Mike Mullikins uncle
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This. The post is basically solipsistic because all value is subjective. Nothing has intrinsic value. Everyone has their own subjective valuation for whatever is bought and sold. The interplay of all these valuations, of buyers and sellers, is what can be described by supply and demand curves, which find a market-clearing price. You could call this price an "intrinsic value", but there is nothing "intrinsic" about it because it is constantly changing. Many serious, professional investors are now into Bitcoin. Are they infallible? Hardly. So it'll be interesting to see how it plays out.
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The fox knows many things, but the hedgehog knows one big thing.Greg Utas wrote:
Many serious, professional investors are now into Bitcoin. Are they infallible? Hardly. So it'll be interesting to see how it plays out.
They're keeping their hands on the trigger to be the first to get out. You can be sure of that.
"The difference between genius and stupidity is that genius has its limits." - Albert Einstein
"If you are searching for perfection in others, then you seek disappointment. If you seek perfection in yourself, then you will find failure." - Balboos HaGadol Mar 2010
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I was first vaguely aware of this as a child - my stamp collection had an unused stamp. It was overprinted (not worth new paper, I suppose) as 100 Million Reichsmarks. Excitement waned as I discovered how much it was not worth.
"The difference between genius and stupidity is that genius has its limits." - Albert Einstein
"If you are searching for perfection in others, then you seek disappointment. If you seek perfection in yourself, then you will find failure." - Balboos HaGadol Mar 2010
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The fox knows many things, but the hedgehog knows one big thing. -
Greg Utas wrote:
Many serious, professional investors are now into Bitcoin. Are they infallible? Hardly. So it'll be interesting to see how it plays out.
They're keeping their hands on the trigger to be the first to get out. You can be sure of that.
"The difference between genius and stupidity is that genius has its limits." - Albert Einstein
"If you are searching for perfection in others, then you seek disappointment. If you seek perfection in yourself, then you will find failure." - Balboos HaGadol Mar 2010
No one rings a bell at the top. Anyone playing that game is either a fool or playing with other people's money. Which certainly does describe some of these folks...
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The fox knows many things, but the hedgehog knows one big thing. -
No one rings a bell at the top. Anyone playing that game is either a fool or playing with other people's money. Which certainly does describe some of these folks...
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The fox knows many things, but the hedgehog knows one big thing.Greg Utas wrote:
Anyone playing that game is either a fool or playing with other people's money.
You're confusing value and money here. If you don't want to loose value, put it in something that keeps it. (Like in; not the US dollar)
Bastard Programmer from Hell :suss: "If you just follow the bacon Eddy, wherever it leads you, then you won't have to think about politics." -- Some Bell.
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Greg Utas wrote:
Anyone playing that game is either a fool or playing with other people's money.
You're confusing value and money here. If you don't want to loose value, put it in something that keeps it. (Like in; not the US dollar)
Bastard Programmer from Hell :suss: "If you just follow the bacon Eddy, wherever it leads you, then you won't have to think about politics." -- Some Bell.
"Money is gold, and nothing else." "Gold is money. Everything else is credit." --J.P.Morgan
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The fox knows many things, but the hedgehog knows one big thing. -
"Money is gold, and nothing else." "Gold is money. Everything else is credit." --J.P.Morgan
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The fox knows many things, but the hedgehog knows one big thing.Greg Utas wrote:
"Money is gold, and nothing else." "Gold is money. Everything else is credit."
I completely agree; but that is the short version. First, gold is easy recognizable and has value during wars, even if you have to trade your wedding ring for some eggs. Never read about BC during wars, it's too young for that. Wood is money. Because it has uses, and there's demand. As wood, gold is a resource, creating demand and giving it value. Also, most stable commodities hardly change in value, it is more often the price of the commodity changing in the local fiat-value. Gold is for kings. Platinum for Emperors, Silver for the nobles. I held gold and silver, and must say that it pays more than a savings-account, just due inflation. And gold is the safer one. Gold is the ultimate money; it has high demand, is easily divided, works good to store value (meaning, no inflation due to people "producing" gold). Silver is a good second, but is a lot more unpredictable in value, very volatile compared to gold. BC is acting like a competitor to my silver holdings, so not happy with that. Personal preferences don't dictate economics. People are moving to BC, even at these rates that look rediculous to me; but I have truly no idea about what the future holds and where we be in hundred years.
Bastard Programmer from Hell :suss: "If you just follow the bacon Eddy, wherever it leads you, then you won't have to think about politics." -- Some Bell.
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Greg Utas wrote:
"Money is gold, and nothing else." "Gold is money. Everything else is credit."
I completely agree; but that is the short version. First, gold is easy recognizable and has value during wars, even if you have to trade your wedding ring for some eggs. Never read about BC during wars, it's too young for that. Wood is money. Because it has uses, and there's demand. As wood, gold is a resource, creating demand and giving it value. Also, most stable commodities hardly change in value, it is more often the price of the commodity changing in the local fiat-value. Gold is for kings. Platinum for Emperors, Silver for the nobles. I held gold and silver, and must say that it pays more than a savings-account, just due inflation. And gold is the safer one. Gold is the ultimate money; it has high demand, is easily divided, works good to store value (meaning, no inflation due to people "producing" gold). Silver is a good second, but is a lot more unpredictable in value, very volatile compared to gold. BC is acting like a competitor to my silver holdings, so not happy with that. Personal preferences don't dictate economics. People are moving to BC, even at these rates that look rediculous to me; but I have truly no idea about what the future holds and where we be in hundred years.
Bastard Programmer from Hell :suss: "If you just follow the bacon Eddy, wherever it leads you, then you won't have to think about politics." -- Some Bell.
Silver is more volatile than gold because its monetary role has diminished. More of the demand for it is now industrial, so its value depends more on economic conditions. Mexico and China were on a silver standard (rather than a gold standard) for a while, but even silver coins went out of circulation in the US after 1964, and in Canada after 1967. Nickels aren't even made of nickel any longer, nor pennies of copper. Even most fiat is no longer backed by paper and is just electronic entries in a bank account.
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The fox knows many things, but the hedgehog knows one big thing. -
Silver is more volatile than gold because its monetary role has diminished. More of the demand for it is now industrial, so its value depends more on economic conditions. Mexico and China were on a silver standard (rather than a gold standard) for a while, but even silver coins went out of circulation in the US after 1964, and in Canada after 1967. Nickels aren't even made of nickel any longer, nor pennies of copper. Even most fiat is no longer backed by paper and is just electronic entries in a bank account.
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The fox knows many things, but the hedgehog knows one big thing.Greg Utas wrote:
Silver is more volatile than gold because its monetary role has diminished.
Ehr.. no, hasn't diminished, and the available gold to silver ratio hasn't moved much. Most of that is speculation.
Greg Utas wrote:
More of the demand for it is now industrial
If you follow the James Bond movies you know that not true :) And in some languages, silver is a one-to-one translation to money.
Greg Utas wrote:
Mexico and China were on a silver standard (rather than a gold standard) for a while, but even silver coins went out of circulation in the US after 1964
Just a few years before gold.
Greg Utas wrote:
Nickels aren't even made of nickel any longer, nor pennies of copper.
Inflation, my reason to be a silverbug. Fiat is on a government fixed line (a target of 2% annual, for those who can count). If you bad at math you deserve that penalty.
Bastard Programmer from Hell :suss: "If you just follow the bacon Eddy, wherever it leads you, then you won't have to think about politics." -- Some Bell.
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Greg Utas wrote:
Silver is more volatile than gold because its monetary role has diminished.
Ehr.. no, hasn't diminished, and the available gold to silver ratio hasn't moved much. Most of that is speculation.
Greg Utas wrote:
More of the demand for it is now industrial
If you follow the James Bond movies you know that not true :) And in some languages, silver is a one-to-one translation to money.
Greg Utas wrote:
Mexico and China were on a silver standard (rather than a gold standard) for a while, but even silver coins went out of circulation in the US after 1964
Just a few years before gold.
Greg Utas wrote:
Nickels aren't even made of nickel any longer, nor pennies of copper.
Inflation, my reason to be a silverbug. Fiat is on a government fixed line (a target of 2% annual, for those who can count). If you bad at math you deserve that penalty.
Bastard Programmer from Hell :suss: "If you just follow the bacon Eddy, wherever it leads you, then you won't have to think about politics." -- Some Bell.
Gold coins went out of circulation in the US in 1933, when FDR confiscated them all. Americans were not allowed to own gold again until 1975 (except for jewelry and collectible coins). I think you're referring to 1971, when Nixon no longer allowed other countries to exchange the US dollars (that they received in trade) for gold. This broke the Bretton Woods agreement of 1944. "Inflation target of 2%" = "That's how much, in excess of economic growth, we need to conjure and give to special interests."
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The fox knows many things, but the hedgehog knows one big thing. -
Gold coins went out of circulation in the US in 1933, when FDR confiscated them all. Americans were not allowed to own gold again until 1975 (except for jewelry and collectible coins). I think you're referring to 1971, when Nixon no longer allowed other countries to exchange the US dollars (that they received in trade) for gold. This broke the Bretton Woods agreement of 1944. "Inflation target of 2%" = "That's how much, in excess of economic growth, we need to conjure and give to special interests."
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The fox knows many things, but the hedgehog knows one big thing.Greg Utas wrote:
Gold coins went out of circulation in the US in 1933, when FDR confiscated them all
Officially they did. Don't be naive and assume that all gold coins were confiscated.
Greg Utas wrote:
Americans were not allowed to own gold again until 1975 (except for jewelry and collectible coins)
And thus, lots more coins became colletible :D
Greg Utas wrote:
I think you're referring to 1971
You shouldn't think. Verifying is better than thinking.
Greg Utas wrote:
This broke the Bretton Woods agreement of 1944.
Tis, but there's much more history to it than that, like Browns' Bottom.
Greg Utas wrote:
That's how much, in excess of economic growth, we need to conjure and give to special interests
With an ageing population, that's just a fraction of how much refugees we require. Our economic growth is based on lending, and that growing pool is only vaiable if the amount of participants grow. Our economy is based on the amount of consumers growing, and we an aging population. So we create wars and generate regugees, and conjure up more consumers to keep the boat going. We not taking those refugees because we think they deserve it, but because we need to grow the population, which our greying society just doesn't. No new consumers without refugees. And anyone who knows basic math can explain how that line will break. May take more than a hundred years, but eventually, it will break. Even if we go "rabbit" and grow our own; there's a natural limit to supply, and as such, the current trend of growth will stop. We dunno when, but math says it will. And me? I'll be having fun, because silver doesn't have an inflation target. Like BC, the amount of silver is limited. Look up historical gains, if you really interested. Gold did over 300% over the last years, compare that to your fiat savings account.
Bastard Programmer from Hell :suss: "If you just follow the bacon Eddy, wherever it leads you, then you won't have to think about politics." -- Some Bell.
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Greg Utas wrote:
Gold coins went out of circulation in the US in 1933, when FDR confiscated them all
Officially they did. Don't be naive and assume that all gold coins were confiscated.
Greg Utas wrote:
Americans were not allowed to own gold again until 1975 (except for jewelry and collectible coins)
And thus, lots more coins became colletible :D
Greg Utas wrote:
I think you're referring to 1971
You shouldn't think. Verifying is better than thinking.
Greg Utas wrote:
This broke the Bretton Woods agreement of 1944.
Tis, but there's much more history to it than that, like Browns' Bottom.
Greg Utas wrote:
That's how much, in excess of economic growth, we need to conjure and give to special interests
With an ageing population, that's just a fraction of how much refugees we require. Our economic growth is based on lending, and that growing pool is only vaiable if the amount of participants grow. Our economy is based on the amount of consumers growing, and we an aging population. So we create wars and generate regugees, and conjure up more consumers to keep the boat going. We not taking those refugees because we think they deserve it, but because we need to grow the population, which our greying society just doesn't. No new consumers without refugees. And anyone who knows basic math can explain how that line will break. May take more than a hundred years, but eventually, it will break. Even if we go "rabbit" and grow our own; there's a natural limit to supply, and as such, the current trend of growth will stop. We dunno when, but math says it will. And me? I'll be having fun, because silver doesn't have an inflation target. Like BC, the amount of silver is limited. Look up historical gains, if you really interested. Gold did over 300% over the last years, compare that to your fiat savings account.
Bastard Programmer from Hell :suss: "If you just follow the bacon Eddy, wherever it leads you, then you won't have to think about politics." -- Some Bell.
Good old Gordon Brown, who sold a pile of Her Majesty's gold on a bottom tick. Your refugee take is interesting, but economic growth would be far less important without all the unfunded pension liabilities. I think that's more of a driving force. But so far it isn't working, because many refugees have low-paying jobs, or none. Doomsayers keep channeling Malthus, but nothing so far. Maybe one day. Or maybe humankind will eventually be expanding at the speed of light. :laugh: Gold since the end of Bretton Woods in 1971 (USD 42/oz) is a good starting point, for a CAGR of 7.8% since the printing presses really got cranked up. And in 1967, when Canada last minted silver coins, 10 cents bought a liter of gasoline. It still does, despite far greedier tax collectors.
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The fox knows many things, but the hedgehog knows one big thing. -
Good old Gordon Brown, who sold a pile of Her Majesty's gold on a bottom tick. Your refugee take is interesting, but economic growth would be far less important without all the unfunded pension liabilities. I think that's more of a driving force. But so far it isn't working, because many refugees have low-paying jobs, or none. Doomsayers keep channeling Malthus, but nothing so far. Maybe one day. Or maybe humankind will eventually be expanding at the speed of light. :laugh: Gold since the end of Bretton Woods in 1971 (USD 42/oz) is a good starting point, for a CAGR of 7.8% since the printing presses really got cranked up. And in 1967, when Canada last minted silver coins, 10 cents bought a liter of gasoline. It still does, despite far greedier tax collectors.
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The fox knows many things, but the hedgehog knows one big thing.Greg Utas wrote:
Good old Gordon Brown, who sold a pile of Her Majesty's gold on a bottom tick.
And gave more trust in our fiat, causing our economy to bloom. It's not that black and white, there's just pro's and con's.
Greg Utas wrote:
economic growth would be far less important without all the unfunded pension liabilities. I think that's more of a driving force. But so far it isn't working, because many refugees have low-paying jobs, or none.
It is the only important factor, and it don't matter if they contribute. What matters is debt, and consumption. The hallmarks of the US economy. "And nothing else matters, ejeeejej!"
Greg Utas wrote:
Gold since the end of Bretton Woods in 1971 (USD 42/oz) is a good starting point
For what? As a silverbug, we cannot go back. There's not enough to go around, simple as that. If economy fails, the price of gold and silver will fall also!
Greg Utas wrote:
It still does, despite far greedier tax collectors.
American? You been promised "no more taxes" during every presidential campaign in the last 30 or so years. Taxes is what makes Europe better than the US. In every way. Feel free to move, there's some nations in Africa where you hardly pay anything :D :thumbsup:
Bastard Programmer from Hell :suss: "If you just follow the bacon Eddy, wherever it leads you, then you won't have to think about politics." -- Some Bell.
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Also "Musical chairs" - same idea, but you start with N - 1 chairs which N kids walk / run round, and take one away each time you stop the music. last kid seated is the winner. You can get some good fights going if you are careful when you stop the music ... :-D
"I have no idea what I did, but I'm taking full credit for it." - ThisOldTony "Common sense is so rare these days, it should be classified as a super power" - Random T-shirt AntiTwitter: @DalekDave is now a follower!
And it's the likes of Musk playing the tune; deciding when to stop and start; and the "kids" thinking he's got their best interest at heart. But he's actually also in the game, and wants the last chair; and doesn't care if you land on your tail bone.
It was only in wine that he laid down no limit for himself, but he did not allow himself to be confused by it. ― Confucian Analects: Rules of Confucius about his food
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This. The post is basically solipsistic because all value is subjective. Nothing has intrinsic value. Everyone has their own subjective valuation for whatever is bought and sold. The interplay of all these valuations, of buyers and sellers, is what can be described by supply and demand curves, which find a market-clearing price. You could call this price an "intrinsic value", but there is nothing "intrinsic" about it because it is constantly changing. Many serious, professional investors are now into Bitcoin. Are they infallible? Hardly. So it'll be interesting to see how it plays out.
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The fox knows many things, but the hedgehog knows one big thing.The "pros" are just playing the part of Barnum and Bailey; riding the wave of suckers that don't have the means to survive the volatility. No smarts required; just cash (the old stuff). The "pros" are swimming in cash (and real-time data); that's why they're in the game. It's the "fool and his money" angle they're playing. Blinded by the light.
It was only in wine that he laid down no limit for himself, but he did not allow himself to be confused by it. ― Confucian Analects: Rules of Confucius about his food
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"Money is gold, and nothing else." "Gold is money. Everything else is credit." --J.P.Morgan
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The fox knows many things, but the hedgehog knows one big thing.Isn't that 'historic' view what got us into this mess? It's like the (upcoming) economics of a habitable climate..
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Isn't that 'historic' view what got us into this mess? It's like the (upcoming) economics of a habitable climate..
Not sure what you're getting at. I could quibble with the quotes, but both are essentially correct. Economics tries to explain things like how scarce resources are allocated and how prices are determined, so the economics of a habitable climate would be no different than any other.
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The fox knows many things, but the hedgehog knows one big thing.
