reminds me of the icelandic krona
A currency rapidly increasing in value reminds you of one that was rapidly decreasing in value?
Bitcoin exchange rate reached $100 USD per BTC
361–370 of 600 posts
Re: Bitcoin exchange rate reached $100 USD per BTC
#362Earlier today this had 135 comments. Checked later, 200. Now 350! OMG BUY! BUY! BUY!
Re: Bitcoin exchange rate reached $100 USD per BTC
#363Earlier quoted context omitted.
> The reason it's bad is that deflation makes it more profitable to do nothing than to invest. When this happens, people react by not spending money. The market dies. If this is holds true, why do people buy from markets where prices regularly decrease? Wouldn't it follow that they will wait in perpetuity and never buy that new phone/laptop/etc?
> Wouldn't it follow that they will wait in perpetuity and never buy that new phone/laptop/etc? People derive utility from those things. They make calls with their phone and do work on their laptop. Bitcoin is entirely different. It's only purpose is to allow you to buy other stuff.
> It's only purpose is to allow you to buy other stuff.
There is certainly utility in being able to buy stuff that cannot easily be bought with traditional (government) currencies. Namely, things that are illegal in various countries, like drugs or gambling.
Re: Bitcoin exchange rate reached $100 USD per BTC
#364Earlier quoted context omitted.
> The reason it's bad is that deflation makes it more profitable to do nothing than to invest. This makes no sense to me. If keeping 100 units makes one richer because they are worth more in a year, then any investment which has a positive return (that is, you end up with more than 100 units in a year) must be that much better... What am I missing?
Deflation increases the value of holding cash. By definition deflation occurs when the price of a basket of goods decreases. Why invest your money in a basket of goods today when it is going to be cheaper to buy that same basket tomorrow?
Why buy a smartphone when next year's smartphone will be better in every way?
Re: Bitcoin exchange rate reached $100 USD per BTC
#365Earlier quoted context omitted.
Nope, by definition deflation occurs when the authority controlling the money supply (eg the Fed) contracts said money supply. Prices going down is merely a symptom of deflation, but it is not deflation.
Only the Austrians use that definition and they're not a serious school of economics.
"Austrians" are quite serious. Few people take them seriously.
Re: Bitcoin exchange rate reached $100 USD per BTC
#366Earlier quoted context omitted.
That is one theory, and is the prevailing one. It is not necessarily correct. Regardless, it is certainly a consumer's right to store their assets in something that is not inflationary, as most do. Is the population holding empty real estate or gold instead of currency really that much better for the economy? No. Smart money will simply shift out of cash in an inflationary environment, and the value will not necessar…
Gold is a piss poor investment. Owning Real Estate (and making money off of it) entails taking care of it. People taking care of their land (so that it can appreciate in value) is a good thing. The typical Real Estate "investor" adds a ton of value to their home, not just through maintenance, but also additions (ie: a new deck). This maintenance is true value added to the economy. True value that wouldn't have been a…
> Gold is a piss poor investment.
Do you know something that the Chinese, Germans and Russians don't ?
"Central Banks Bought Most Gold in Nearly 50 Years"
http://www.cnbc.com/id/100458951
"The Russian central bank will continue to buy gold as it seeks to diversify its foreign reserves away from paper assets it views as risky"
http://www.reuters.com/article/2013/01/24/russia-cbank-idUSL...
"The startling news that Germany is repatriating its gold reserves from the United States and France has got precious metals speculators worried that this is the first major sign that trust between central banks across the globe could be deteriorating."
http://www.forbes.com/sites/robertlenzner/2013/01/19/the-ger...
"How Much Gold Does China Really Have?... China is the world’s leading gold producer and also the world’s leading gold importer. And surprisingly their official gold holdings haven’t risen an ounce in over three years."
http://www.moneymorning.com.au/20130211/how-much-gold-does-c...
Re: Bitcoin exchange rate reached $100 USD per BTC
#367Earlier quoted context omitted.
In the common scenario where my supplier screws me over on Ebay, I can put a "cancel order" on my credit card. I have no such recourse to do that with Bitcoins. Bitcoins offer no consumer protection right now. Once exchanged, the other party holds the money.
OTOH, if you're the supplier, there is no risk for you to go ahead and send the stuff if you were paid in bitcoin.
Precisely. No risk at all. You don't even have to send your stuff to your client, because you've already been paid.
Bitcoins right now puts the consumer / supplier relationship upside down. The supplier is already right... not the customer. I wonder if any customers will prefer to paying BTC over Paypal, especially after they've been defrauded a few times.
Re: Bitcoin exchange rate reached $100 USD per BTC
#368People like Max Keiser are calling 100k to 1mill per bitcoin. Hard to imagine. I left my gpu running for a few weeks a year or so ago and mined myself 1 bitcoin. I figure that should Keiser's prediction comes true - it will be a nice easy pay day - if not, I didn't waste much time, energy on it. I've been looking at it lately though and thinking that it surely must drop back soon. I'm thinking a drop back down to 15…
Bitcoin is like a startup. If it works, it's worth a tremendous amount. If it doesn't, it's worth nearly nothing. Right now its proponents are valuing it like a tech startup stock- what's its potential future value? Its opponents have already decided it will fail. Either side may be right at this point, though bitcoin has more going for it than it did six months ago. To me, the trend is currently towards "it's going…
My money is on Bitcoin remaining the winner in the cryptocurrency market. It's got enough network effect now for people to keep it a success. The economy is growing, and people have too much vested interest already. Flaws will be fixed, improvements will be made, etc.
Re: Bitcoin exchange rate reached $100 USD per BTC
#369Earlier quoted context omitted.
If I see a currency rising in value faster than Gold itself, I'm going to want to get in on the value. Fact is, if I had "invested" in 100 BTC only 5 months ago when it was hovering around USD$10, that would have cost me about $1000. And now it would be worth $10000. There are not that many investments that have that kind of return in such a short time. You'd have to be dumb to believe that people aren't doing exactl…
This is not rational thinking. Simply because something has gone up in the past does not mean it will continue to. The returns for the past 5 months have been insane, but that doesnt mean it was a good investment 5 months ago because thats based entirely on results oriented thinking. In a casino, if a roulette wheel hit black 10 times in a row, somebody letting it ride on black the whole way would have made a fortune…
The difference and what a lot of people seem to miss is the scarcity of bitcoin and the fact that its makers and followers are bootstrapping a new global economy. Having only $1B in liquidity is not enough to participate in all global markets. If bitcoin successfully acquires fractions of all global markets, there is but only one direction the exchange rate can go, and that is up until there are hundreds of billions of dollar value in bitcoin. Divide that by the 11 million bitcoins in current circulation, and each one will be worth thousands and thousands of dollars.
Re: Bitcoin exchange rate reached $100 USD per BTC
#370Earlier quoted context omitted.
>My fiancee owns her house but still pays rent to a land lord. How... what...? Please explain.
UK land rights are much different then the US owing to their history of kings and lords. You don't pay property tax[1] on the land you hold. As a result there isn't much incentive to ever sell your land. Since other people still want to live on your land though you set up a deal so that they can build houses and live on that land, but they have to pay you rent. You are effectively a landlord in the truest sense of th…
This is not false but the majority of people and properties are freehold, not leasehold. Around 3 million properties are leasehold, the majority are flats, with 1 million being houses. There are about 25 million residential properties overall, so leasehold is only about 12% of the market.
Plus, in the UK there are certainly liabilities for holding land that has a residential property on it. As the landowner, you'll be paying the council tax on it if you have no tenants, and with many councils now, that'll be a more expensive rate too (currently 150% of the standard rate for unoccupied property in my area). Of course, council tax isn't really a property tax, though it can act like one in some situations and basically covers similar things that US property taxes do.