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How an obscure OTC-traded derivative from the 80s took over crypto

blog.everstrike.io

71–79 of 79 posts

Re: How an obscure OTC-traded derivative from the 80s took over crypto

#71
post #15

Perpetual futures are so nice compared to regular tradfi ones. Having to roll over your ES or NQ futures serves no purpose (and it's not like any other future besides the front month is liquid anyways) and is probably just a scam by CME to induce more trading volume. That being said regular futures do make sense for stuff like commodities.

I find it super helpful that cryptobros invented their own lingo. That's because that way, when I get emails from recruiters being mysterious and using words like "tradfi", I know I can safely ignore.

Re: How an obscure OTC-traded derivative from the 80s took over crypto

#72

Earlier quoted context omitted.

Best investment I ever made was in my children. Second was crypto!

Shit, I never invested in children, everyone said it was a negative RoI.

300 grand minimum for the chance to throw half your genetics into the future.

That worth 300k? Opinions differ. I don't have an enormous farm filled with livestock for tiny hands to help with, so I'm going with "no".

Some people think I am immoral for thinking this, but they do not have farms either, so I'm not confident in their judgement. On the other hand, urbanites seem to think children can be replaced by kittens. This is more or less the core of the Culture Wars, so probably starting a huge Internet Fight here.

Re: How an obscure OTC-traded derivative from the 80s took over crypto

#73

Earlier quoted context omitted.

Doesn’t that beg the question? Why hasn’t a platform capitalised on the perpetual future in tradfi markets. I can understand why CME might not. But why wouldn’t a new entrant like robinhood launch perpetual futures?

Because perpetual future doesn't make sense for a lot of things people trade futures for: corn, soybean, crude oil. They have physical presence and in some cases an expiry date. There are futures for other financial instruments or indexes where it might make more sense, but there the use of futures is more about hedging than owning the underlying, since it's not as complicated as owning your own crypto and keeping it…

Well it actually makes sense, production is often continuous, most producers just want to hedge some risk due to price fluctuations over the time, they have no interest in physical delivery because it is often expensive.

Re: How an obscure OTC-traded derivative from the 80s took over crypto

#74

Earlier quoted context omitted.

Shit, I never invested in children, everyone said it was a negative RoI.

300 grand minimum for the chance to throw half your genetics into the future. That worth 300k? Opinions differ. I don't have an enormous farm filled with livestock for tiny hands to help with, so I'm going with "no". Some people think I am immoral for thinking this, but they do not have farms either, so I'm not confident in their judgement. On the other hand, urbanites seem to think children can be replaced by kitten…

I don’t usually respond to anti-children trolls, but this is a sub-thread responding to a comment around crypto, so there’s already overlap.

Anyway, I’ll bite: one of humanity’s instincts is to have a family. It’s not amoral, it’s at the core of our being.

Re: How an obscure OTC-traded derivative from the 80s took over crypto

#75

Earlier quoted context omitted.

The oil future prices drop to negative in an exchange in 2020. Funds rolling over the contract in subsequent months also took a big loss for rolling over contracts because price disparity in different months. Perpetual futures would eliminate such risks.

The facts regarding crude futures dropping to negative a day in 2020 are actually more to do with the fact every bit of storage in the US was full. The companies closing contracts were hedged by this point anyways, as demand had all but dried up completely. Perpetual futures would go against the entire point of having contacts for specified length of time. That point is time itself, the other major variable in financ…

The SPR wasn't full; I wish we would have filled it up.

Re: How an obscure OTC-traded derivative from the 80s took over crypto

#76
post #74

Earlier quoted context omitted.

300 grand minimum for the chance to throw half your genetics into the future. That worth 300k? Opinions differ. I don't have an enormous farm filled with livestock for tiny hands to help with, so I'm going with "no". Some people think I am immoral for thinking this, but they do not have farms either, so I'm not confident in their judgement. On the other hand, urbanites seem to think children can be replaced by kitten…

I don’t usually respond to anti-children trolls, but this is a sub-thread responding to a comment around crypto, so there’s already overlap. Anyway, I’ll bite: one of humanity’s instincts is to have a family. It’s not amoral, it’s at the core of our being.

Dang, sorry that came off that way. I like kids. I didn't think that sounded like an anti-child troll. I got my three nibs for the summer, so I might let them know for their own good. Parents shouldn't leave their kids with trolls!

Humans have a complicated relationship with their "instincts". Why is that? We have culture, which can (theoretically) adapt very rapidly compared to information exchange via sex / virus / "some other mystery horizontal genetic transfer". How much more rapidly? It's faster, but how much faster is a hugely debated topic in anthropology and genetics. Same net effect: humans, probably since before they were humans, have felt almost constantly at war with their "instincts", since culture is always faster to adapt.

Here's another trick: how do you differentiate between an "instinct" and a general want? You kind of don't, and this opens up a rhetorical relationship with the whole concept of "instinct" that has a heavy history and lives into the present day. But do we know what our instincts are? We could jump deep into the fMRI rabbit hole here, saying this "pathway" this, and "horrible abuse of stats" that, but I think that's a waste of effort. It doesn't matter - not in this context, I DO think it's needed science - because both instinct and culture have the same desired end state: human - and American, if possible - survival. Why not just break it down old fashioned utilitarian style? Which is why I bring up farms. Post-agricultural, an industrial state NEEDS to support birth rates via direct subsidies, as in paychecks.

This never happens, so kids don't happen either, and we start talking about three hundred grand and instincts and trolls and all the rest.

We love blaming those at our same socio-economic level for the ills that we perceive in the world, but often it's our masters who gain the most from pointing us at each other's throats. The loss of traditional values, the shattering of the working class, the collapse of masculinity, the dehumanization of the black and of the woman, the ever-shrinking family, the escalating violence of state security, the complete loss of any sense of privacy or decency - it's the same force making these things happen. HAS BEEN MAKING them happen, for years, decades or even centuries.

How this country responds to that fact decides everything, including how we respond in a peer conflict. Would the Democrats necessarily mind a losing ground war that drains the countryside? Would the Republicans necessarily retaliate after a few dozen megatons land on NYC, LAX, SFO, PDX, and SEA? That's why I worry about this shit. Because as much as we might hate , I guarantee we really need to hate the PLAAF more.

Re: How an obscure OTC-traded derivative from the 80s took over crypto

#77
post #59

Earlier quoted context omitted.

It's not a Ponzi scheme if you have a real economy generating real economic activity. The military isn't really the important part, it's the ability to tax a massive economy and then invest that money in eg infrastructure projects that help the economy grow. Ponzi schemes fail because the money isn't invested anywhere, it's just moved around. This makes it impossible for Ponzi schemes to be positive sum, so they're i…

Are you staying that fed taxes are positive sum for the economy? That's a pretty bold claim, as most people would have trouble citing $3 trillion in real value the fed gov creates each year.

You're saying if the US government disappeared tomorrow the hit to the GDP would be less than $3T? I have trouble taking that claim seriously.

Re: How an obscure OTC-traded derivative from the 80s took over crypto

#78
post #65

Earlier quoted context omitted.

Are you staying that fed taxes are positive sum for the economy? That's a pretty bold claim, as most people would have trouble citing $3 trillion in real value the fed gov creates each year.

Things like creating highways, making sure our food is uncontaminated, running the GPS, etc, etc, provide incredible value to the economy, yes. We are after all talking across an internet developed with public funding. They might not do so in a way people take note of, but it doesn't seem like a particularly bold claim to me.

the things you cited are like 2% of the budget, and I fully agree. For the other 90% of the budget, I still am very skeptical that its GDP positive (our defense budget is mostly about blowing things up, which destroys wealth instead of creating it)

Re: How an obscure OTC-traded derivative from the 80s took over crypto

#79
post #65

Earlier quoted context omitted.

Things like creating highways, making sure our food is uncontaminated, running the GPS, etc, etc, provide incredible value to the economy, yes. We are after all talking across an internet developed with public funding. They might not do so in a way people take note of, but it doesn't seem like a particularly bold claim to me.

the things you cited are like 2% of the budget, and I fully agree. For the other 90% of the budget, I still am very skeptical that its GDP positive (our defense budget is mostly about blowing things up, which destroys wealth instead of creating it)

Well, when the government spends $1 it contributes $1 to GDP (regardless of what it's spent on), but note that whether or not an investment helps the economy of the US expand is an entirely different question to how it impacts the world. Things can be a net negative to the world and expand the economy.

Also note that I intend these as descriptive and not proscriptive statements. I'm not trying to say the government isn't wasteful (though 90-98% waste is an overstatement) or that it's the best way to do things, I'm just trying to illustrate why seemingly ponzi-like systems like national currencies can be economically productive and stable over long periods of time while truly ponzi-like systems rarely have longevity (Herbalife and Amway being exceptions to this rule, in my opinion) because they don't actually produce anything.

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