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Credit Suisse’s $17B of Risky Bonds Are Now Worthless

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Re: Credit Suisse’s $17B of Risky Bonds Are Now Worthless

#111

Post by hbrn »

qwytw wrote: post #89
hbrn wrote: post #74

Earlier quoted context omitted.

I never really understood this reasoning, is it just simple envy? Ok, so a few folks will amass a lot of wealth based on luck and not merit. Those already exist in current financial system, both locally and globally. Plenty of dictators have control over natural resources worth trillions. There are numerous issues with bitcoin replacing USD, I'm just surprised why you think that few nerds becoming billionaires is a m…

I'm sorry but I really I can't tell if you're being sarcastic or not, but I'll assume that you're not... > so a few folks will amass a lot of wealth based on luck and not merit You severely underestimate how concentrated bitcoin ownership is. A couple of hundred people would control a significant proportion of the global economy just because they were lucky. Why would you want some random people controlling the major…

> You severely underestimate how concentrated bitcoin ownership is. A couple of hundred people would control a significant proportion of the global economy just because they were lucky

Why don't you share the numbers then, what is significant in your mind? I can make the exact same claim about the current state of affairs.

As far as I know, there are no privately owned wallets holding more than 0.5% of BTC.

Re: Credit Suisse’s $17B of Risky Bonds Are Now Worthless

#112

Post by qwytw »

hbrn wrote: post #111
qwytw wrote: post #89

Earlier quoted context omitted.

I'm sorry but I really I can't tell if you're being sarcastic or not, but I'll assume that you're not... > so a few folks will amass a lot of wealth based on luck and not merit You severely underestimate how concentrated bitcoin ownership is. A couple of hundred people would control a significant proportion of the global economy just because they were lucky. Why would you want some random people controlling the major…

> You severely underestimate how concentrated bitcoin ownership is. A couple of hundred people would control a significant proportion of the global economy just because they were lucky Why don't you share the numbers then, what is significant in your mind? I can make the exact same claim about the current state of affairs. As far as I know, there are no privately owned wallets holding more than 0.5% of BTC.

> Why don't you share the numbers then, what is significant in your mind

IIRC there are no numbers. Because nobody really knows who owns what. Also if you had huge amounts of bitcoin why on earth would you hold all of it in single wallet? Makes no sense...

> privately owned wallets holding more than 0.5% of BTC.

Which is an astronomically huge amount for a private individual to own in case BTC replaces dollars. Even if we only count actual dollars bills in circulation that 0.5% of that would be 10.5 billion. What private person could have that much cash stored somewhere? And most importantly why?

If we include entire M1 supply (bills + deposits) 0.5% would be equal to 100 BILLION dollars. That's not an amount that can exist in a single place in USD, no single person does or ever did own such an amount in liquid assets which he could sell transfer the proceeds to someone in a short period of time. That's not really possible.

Re: Credit Suisse’s $17B of Risky Bonds Are Now Worthless

#113

Post by acchow »

personomas wrote: post #99
127 wrote: post #65

Earlier quoted context omitted.

US federal historical government spending is an exponential growth graph. As are unfunded liabilities that politicians at some point promised to pay people. EU seems pretty much the same. More gov spending, more social spending. Repeat ad infinitum. Of course, all of this wealth has to come from some place. Not the rich, because they have enough influence and connections to avoid it.

I totally agree with you. The socialism is unstainable. Especially as the world's population gets older and older. Socialism is not the way

You may be mistaking socialism for social welfare?

Re: Credit Suisse’s $17B of Risky Bonds Are Now Worthless

#114

Post by hbrn »

qwytw wrote: post #112
hbrn wrote: post #111

Earlier quoted context omitted.

> You severely underestimate how concentrated bitcoin ownership is. A couple of hundred people would control a significant proportion of the global economy just because they were lucky Why don't you share the numbers then, what is significant in your mind? I can make the exact same claim about the current state of affairs. As far as I know, there are no privately owned wallets holding more than 0.5% of BTC.

> Why don't you share the numbers then, what is significant in your mind IIRC there are no numbers. Because nobody really knows who owns what. Also if you had huge amounts of bitcoin why on earth would you hold all of it in single wallet? Makes no sense... > privately owned wallets holding more than 0.5% of BTC. Which is an astronomically huge amount for a private individual to own in case BTC replaces dollars. Even…

> no single person does or ever did own such an amount in liquid assets which he could sell transfer the proceeds to someone in a short period of time

You seem to be confusing three similar, but fundamentally different things: physical cash, liquid assets, and being able to transfer in short period of time.

Just because billionaire's assets are illiquid, it doesn't mean they can't transfer $10B in a short period of time. It simply means that portion of value will be lost during that transfer.

> What private person could have that much cash stored somewhere? And most importantly why?

Elon had $20B in cash (i.e. liquid assets) after selling 10% of his Tesla shares. He lost some value in the process, but afterwards he had $20B of liquid assets, which debunks your statement.

Arguably, same will happen to $10B of BTC, given that such transaction(s) would be public and will raise concerns.

And that's just Elon Musk, we're not even talking about western adversaries, like Putin or Xi, who have access to even more assets.

And if we're thinking of BTC simply replacing physical cash, then you can even build fractional reserve system on top of it.

Also, we seem to be discussing a magical world where BTC became the major currency overnight, with no time for financial system to adapt. If we go back to the real world, I could totally entertain a thought experiment of BTC replacing USD. Not that I support it, but again, few lucky billionaires is the least of my concerns, given that we already have those in the current system.

Re: Credit Suisse’s $17B of Risky Bonds Are Now Worthless

#116

Post by qwytw »

hbrn wrote: post #114
qwytw wrote: post #112

Earlier quoted context omitted.

> Why don't you share the numbers then, what is significant in your mind IIRC there are no numbers. Because nobody really knows who owns what. Also if you had huge amounts of bitcoin why on earth would you hold all of it in single wallet? Makes no sense... > privately owned wallets holding more than 0.5% of BTC. Which is an astronomically huge amount for a private individual to own in case BTC replaces dollars. Even…

> no single person does or ever did own such an amount in liquid assets which he could sell transfer the proceeds to someone in a short period of time You seem to be confusing three similar, but fundamentally different things: physical cash, liquid assets, and being able to transfer in short period of time. Just because billionaire's assets are illiquid, it doesn't mean they can't transfer $10B in a short period of t…

> Also, we seem to be discussing a magical world where BTC became the major currency overnight

True that the thing. Bitcoing is so fundamentally unfit to be a currency that any attempt to make it such would fail long before any of these issues would become relevant.

> again, few lucky billionaires is the least of my concerns, given that we already have those in the current system

So take one of the biggest issues with the current system, make it 10+ times worse and see what happens...

Re: Credit Suisse’s $17B of Risky Bonds Are Now Worthless

#117

Post by personomas »

acchow wrote: post #113
personomas wrote: post #99

Earlier quoted context omitted.

I totally agree with you. The socialism is unstainable. Especially as the world's population gets older and older. Socialism is not the way

You may be mistaking socialism for social welfare?

Yeah, social welfare through policies of socialism.

Re: Credit Suisse’s $17B of Risky Bonds Are Now Worthless

#118

Post by HashBasher »

fellellor wrote: post #77
lowkey wrote: post #46

Earlier quoted context omitted.

To nitpick, Bitcoin doesn’t currently have a fixed supply. It has a supply cap that takes effect sometime in 2140. Bitcoin currently inflates by 6.25 BTC every ~10 minutes. For the record, I agree that early Bitcoiners took an incredible risk on a highly volatile asset and they should be rewarded for such. As I see it, this latest banking crisis is showing the world that there is more than one type of risk. Bitcoin h…

Haven’t they already been rewarded for it? The magic Internet money is worth more than 20k USD, whereas it started out at 0.

They have and they deserve it. As bitcoin continues it's journey higher, all bitcoiners will be well rewarded (new or old).

Re: Credit Suisse’s $17B of Risky Bonds Are Now Worthless

#119

Post by HashBasher »

qwytw wrote: post #92
HashBasher wrote: post #57

Earlier quoted context omitted.

When describing the currency itself, bitcoin is strictly not deflationary as the supply of it is never reduced, it's actually inflationary for the next hundred years or so until the full 21 million is mined. It might create a deflationary economy in that everything gets cheaper over time, priced in bitcoin. What is so wrong with that? Why can't you expect to purchase more goods in the future than today with the same…

> What is so wrong with that? Imagine an economy with both ultra high interest rates and very high deflation at the same time. Let's say CPI growth somehow falls to - 20% and the Fed decides to hike interest rates to + 20%* what do you think would happen? Well take the Great Depression and multiple it by N (no idea, I'd assume N >= 20 though). Sound great? How does close to zero capital investment into the economy so…

> No loans, no VCs

I don't think so. There will definitely be companies and startups that yield better returns than bitcoin. Especially when bitcoin stabilizes at a very high value, holders will start speculating.

Re: Credit Suisse’s $17B of Risky Bonds Are Now Worthless

#120

Post by yazaddaruvala »

ben_w wrote: post #110
yazaddaruvala wrote: post #88

Earlier quoted context omitted.

> one advantage Bitcoin does not have, that fiat does, is an armed gang with orders to enforce its use by all citizens. Nail on the head! The only difference between "tokens" and "currency" is an army and taxes!

Is even that a difference? Countries don't all use their own currencies (and I don't just mean the Euro zone, this also happens with USD and used to happen with GBP), but they do all have their own taxes. Some countries don't have any armed forces unless you count the police. And the force of law is enough of a threat to get people to hand over crypto keys when they're physically in the relevant jurisdictions and the…

> Countries don't all use their own currencies

Sure. I think this missed the point.

I didn't say/intend "a country / army needs to be backed by a unique currency"

I said, "For a token to be a currency, it needs to be backed by [at least one] army and [at least one country's] taxes".

e.g. The Euro happens to be backed by multi armies and at least Germany's taxes.

> Some countries don't have any armed forces unless you count the police.

Again, it isn't "their army" but it is "an army". e.g. Liechtenstein is backed by "Austria and Switzerland under an informal agreement among the three countries." https://en.wikipedia.org/wiki/List_of_countries_without_arme...

Anyways, if we disagree that is ok too. All of this is quite fuzzy really.

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