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Realtime Bitcoin Stats

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Re: Realtime Bitcoin Stats

#121

Post by gibybo »

deelowe wrote: post #118
dj2stein9 wrote: post #83

Earlier quoted context omitted.

I don't believe the argument that a deflationary currency, by itself, will make people not be willing to buy things. Consider a savings account - why would anyone take money out of their savings account to buy things? If all you need to do is keep it in the account, it will make more money, so why spend it?

Savings accounts don't beat inflation. No guaranteed and insured investment does to my knowledge(if you find one that's not a ponzi scheme, let me know). If savings accounts were paying out double digit % point gains, you can bet your ass people would be shoveling money into the accounts and not cashing out.

They aren't beating inflation right now, but historically they have. ~5 years ago interest rates on savings accounts were roughly 5% and inflation was 3-4%. Empirically, people actually saved less during that time (although there were many other confounding factors).

Re: Realtime Bitcoin Stats

#122

Post by wamatt »

treeface wrote: post #119
wamatt wrote: post #116

Earlier quoted context omitted.

>"It seems there's a hesitation of spending bitcoins knowing if you just wait a day it will go up" So this argument seems to be rather popular, and on the surface it does seems to make sense. However, it glosses over an important consideration. Are you buying goods in USD or BTC? Now if it's the latter, then yes there may be stronger psychological pressure (even though rationally there is not much difference). Howeve…

I've spent many years studying economics, but I'm also a programmer. One thing that annoys me about the discussion that tends to crop up on Hacker News is that you have too many of the latter issuing too many uninformed opinions on the former. Currencies that are doomed to deflate are doomed to enter liquidity traps. There is nothing special about BitCoin that prevents this from happening, regardless of its position…

The difference between a normal currency and bitcoin with regards to deflation is that bitcoin is almost infinitely divisible, whereas traditional currencies are not.

Divisibility acts in opposition to deflation to create liquidity.

The idea is in the future you don't trade bitcoins per se, but microbits, or picobits etc (or whatever they will be called).

Re: Realtime Bitcoin Stats

#123

Post by wmf »

jes5199 wrote: post #91

a thing I've been wishing I had is some sort of price-vs-difficulty comparison metric - you might think, for example, that the dramatic rise in bitcoin costs would mean that mining had gotten more profitable - but unfortunately, the first wave of "Application Specific Integrated Circuits" are being deployed, and they're not even available for sale yet - so the mining capacity is suddenly and dramatically in the hands…

Check out the "mining factor" metric: http://www.bitcoinx.com/charts/ Mining is as profitable today as it was back in July 2011.

Re: Realtime Bitcoin Stats

#124

Post by deelowe »

gibybo wrote: post #121
deelowe wrote: post #118

Earlier quoted context omitted.

Savings accounts don't beat inflation. No guaranteed and insured investment does to my knowledge(if you find one that's not a ponzi scheme, let me know). If savings accounts were paying out double digit % point gains, you can bet your ass people would be shoveling money into the accounts and not cashing out.

They aren't beating inflation right now, but historically they have. ~5 years ago interest rates on savings accounts were roughly 5% and inflation was 3-4%. Empirically, people actually saved less during that time (although there were many other confounding factors).

Point taken, but we're still arguing apples and oranges. Savings accounts historically maybe earned a percent or two above inflation. There's very little incentive to just let money sit in a savings account at those rates. Even extremely low risk investments are better.

Re: Realtime Bitcoin Stats

#125

Post by drcode »

treeface wrote: post #119
wamatt wrote: post #116

Earlier quoted context omitted.

>"It seems there's a hesitation of spending bitcoins knowing if you just wait a day it will go up" So this argument seems to be rather popular, and on the surface it does seems to make sense. However, it glosses over an important consideration. Are you buying goods in USD or BTC? Now if it's the latter, then yes there may be stronger psychological pressure (even though rationally there is not much difference). Howeve…

I've spent many years studying economics, but I'm also a programmer. One thing that annoys me about the discussion that tends to crop up on Hacker News is that you have too many of the latter issuing too many uninformed opinions on the former. Currencies that are doomed to deflate are doomed to enter liquidity traps. There is nothing special about BitCoin that prevents this from happening, regardless of its position…

I was wondering why no one ever buys or sells houses. But your post makes it perfectly clear: Since no more land is created, real estate is deflationary, so obviously no one would ever sell a house.

Also, I'm happy you're patting yourself on the back for all your training and experience. But you still need to make a compelling argument instead of just saying "Things are just so."

Re: Realtime Bitcoin Stats

#127

Post by dragontamer »

drcode wrote: post #125
treeface wrote: post #119

Earlier quoted context omitted.

I've spent many years studying economics, but I'm also a programmer. One thing that annoys me about the discussion that tends to crop up on Hacker News is that you have too many of the latter issuing too many uninformed opinions on the former. Currencies that are doomed to deflate are doomed to enter liquidity traps. There is nothing special about BitCoin that prevents this from happening, regardless of its position…

I was wondering why no one ever buys or sells houses. But your post makes it perfectly clear: Since no more land is created, real estate is deflationary, so obviously no one would ever sell a house. Also, I'm happy you're patting yourself on the back for all your training and experience. But you still need to make a compelling argument instead of just saying "Things are just so."

But the housing industry is barely recovering from a "liquidity trap" in 2008! People weren't selling houses because they expected home prices to constantly go up. You had people flipping homes and adding no value to them. Eventually, the market crashes after too many people buy homes that they didn't need...

Note, its not that people "don't sell homes", it is that homes are prone to rampant speculation that can bring down the entire industry.

His claim is that a fiat currency (ie: Dollar), can repel the liquidity trap with monetary policy. IE: Carefully controlled inflation or deflation.

Re: Realtime Bitcoin Stats

#128

Post by drcode »

dragontamer wrote: post #127
drcode wrote: post #125

Earlier quoted context omitted.

I was wondering why no one ever buys or sells houses. But your post makes it perfectly clear: Since no more land is created, real estate is deflationary, so obviously no one would ever sell a house. Also, I'm happy you're patting yourself on the back for all your training and experience. But you still need to make a compelling argument instead of just saying "Things are just so."

But the housing industry is barely recovering from a "liquidity trap" in 2008! People weren't selling houses because they expected home prices to constantly go up. You had people flipping homes and adding no value to them. Eventually, the market crashes after too many people buy homes that they didn't need... Note, its not that people "don't sell homes", it is that homes are prone to rampant speculation that can brin…

OK, you made some good points I will have to think about more. I would think the type of deflation we're discussing had only a small role to play in that crisis, but I admit it probably played some.

Of course the irony is that monetary policy causing unreasonably low interest rates (i.e. controlled inflation) was a large factor of that crisis as well.

Re: Realtime Bitcoin Stats

#129

Post by dustyleary »

mkr-hn wrote: post #110
myspace wrote: post #96

Earlier quoted context omitted.

What pisses me off is people are falling into this Ponzi Scheme.

How is it a Ponzi scheme? I don't see anyone promising returns to previous investors based on money taken from new investors.

It's a bit of a stretch to call it a Ponzi scheme IMO, but you could try to make the argument that all the early investors who got in for cheap/"free" are now cashing out with the money of new investors.

But, the "Ponzi scheme" people are essentially engaging in name calling, because its definitely not a Ponzi scheme. There is no Ponzi (or Madoff) at the top running the scheme.

Better to rationally call it what it is: an enormous ramp in the spot price driven almost purely by speculation.

Some people say it's a classic bubble. Bitcoin already had one of these in 2011, this could be another.

Some people say bitcoin is different than other commodities, that this is not a bubble, but more of a "tipping point" event where bitcoin has gained enough traction/attention that it is rocketing up to its "true" value.

Pick your side, and if you're so inclined, place your bets.

Re: Realtime Bitcoin Stats

#130

Post by dragontamer »

drcode wrote: post #128
dragontamer wrote: post #127

Earlier quoted context omitted.

But the housing industry is barely recovering from a "liquidity trap" in 2008! People weren't selling houses because they expected home prices to constantly go up. You had people flipping homes and adding no value to them. Eventually, the market crashes after too many people buy homes that they didn't need... Note, its not that people "don't sell homes", it is that homes are prone to rampant speculation that can brin…

OK, you made some good points I will have to think about more. I would think the type of deflation we're discussing had only a small role to play in that crisis, but I admit it probably played some. Of course the irony is that monetary policy causing unreasonably low interest rates (i.e. controlled inflation) was a large factor of that crisis as well.

Got an argument to back that up?

Why don't you go through the charts. Find me the year that the Fed caused too much inflation, and then tell me how much the dollar was inflated that year.

I doubt you can, because during the housing crisis, the dollar experienced deflation. The Fed acted swiftly, although not swift enough! The dollar failed to hit inflation targets in 2008-2009 as we experienced -0.4% inflation.

For the 2009 to 2010 years, we only experienced 1.4% inflation. Both years, we missed inflation targets of 3%. Worse, the dollar deflated in value in one year.

Every other year, inflation has been the same as always: ~3% since 1990.

Economic data does not match your words. The US hasn't had inflation over 4% for the last 22 years. There is no inflation problem.

If the goal of ~3% inflation is a poor goal, then tell me why.

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