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Bitcoin heading towards $200, new bubble forming

bitcoinwisdom.com

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Re: Bitcoin heading towards $200, new bubble forming

#91

Post by dragonwriter »

jbooth wrote: post #90
snitko wrote: post #89

Earlier quoted context omitted.

No, I don't believe Bitcoin is a ponzi scheme at all. And I really don't think my age is relevant, you either have arguments or you don't. But let's come back to that notion of yours > If you're always incentivized to hold something and never incentivized to spend it, it becomes more of an asset than a currency." Let's say all you got is 10btc and $0 in your bank account. And you need some food. You're probably gonna…

When it comes to thinking "this time is different" and "I have an idea to refactor the world economy", your age is VERY relevant. Everyone thinks they have a simple way to fix everything when they're 22. By the time you're 30-40 it's amazing how much smarter the rest of the world got. You can take my word for it as regards politics and investment, or not, it's your money. On the argument, you're implicitly admitting…

> When it comes to thinking "this time is different" and "I have an idea to refactor the world economy", your age is VERY relevant.

Its really not. If you are trying to evaluate how good of an idea someone is likely to come up with, their scope of understanding of economics and past efforts in that field is relevant, and age is an extremely poor proxy for that. (It's exactly the same problem as using age alone as a proxy for to measure programming skill would be.)

If you have an actual idea in front of you, its better to just evaluate that rather than the source.

> Everyone thinks they have a simple way to fix everything when they're 22. By the time you're 30-40 it's amazing how much smarter the rest of the world got.

That's not universally true, and to the extent it is true, its significantly about increased focus on near-term self (or immediate-circle) interests rather than increased knowledge -- there's a reason why major advancements more often come out of work people do very early in their career.

Re: Bitcoin heading towards $200, new bubble forming

#92

Post by snitko »

jbooth wrote: post #90
snitko wrote: post #89

Earlier quoted context omitted.

No, I don't believe Bitcoin is a ponzi scheme at all. And I really don't think my age is relevant, you either have arguments or you don't. But let's come back to that notion of yours > If you're always incentivized to hold something and never incentivized to spend it, it becomes more of an asset than a currency." Let's say all you got is 10btc and $0 in your bank account. And you need some food. You're probably gonna…

When it comes to thinking "this time is different" and "I have an idea to refactor the world economy", your age is VERY relevant. Everyone thinks they have a simple way to fix everything when they're 22. By the time you're 30-40 it's amazing how much smarter the rest of the world got. You can take my word for it as regards politics and investment, or not, it's your money. On the argument, you're implicitly admitting…

> It seems that we agree on the effects of deflationary currency incentivizing not spending money.

I'd say a deflationary currency incentivizes less spending, not no spending at all. That's the difference.

Now, your point about Bitcoins only being good for storing money, but not for spending. I don't really understand it. Bitcoin is in no way inferior to fiat currencies if you judge it by its properties. In fact, you can spend it much easier and faster than fiat. The adoption problem is a separate problem and it has to do with government regulations to a large extent and people not understanding the technology to a lesser extent. Both problems are temporary. But let's say Bitcoin is accepted everywhere, since we are talking about the idea of a deflationary currency vs an inflationary one. What would be the incentive for me to own any USD?

Re: Bitcoin heading towards $200, new bubble forming

#93

Post by jbooth »

dragonwriter wrote: post #91
jbooth wrote: post #90

Earlier quoted context omitted.

When it comes to thinking "this time is different" and "I have an idea to refactor the world economy", your age is VERY relevant. Everyone thinks they have a simple way to fix everything when they're 22. By the time you're 30-40 it's amazing how much smarter the rest of the world got. You can take my word for it as regards politics and investment, or not, it's your money. On the argument, you're implicitly admitting…

> When it comes to thinking "this time is different" and "I have an idea to refactor the world economy", your age is VERY relevant. Its really not. If you are trying to evaluate how good of an idea someone is likely to come up with, their scope of understanding of economics and past efforts in that field is relevant, and age is an extremely poor proxy for that. (It's exactly the same problem as using age alone as a p…

" their scope of understanding of economics and past efforts in that field is relevant, and age is an extremely poor proxy for that. (It's exactly the same problem as using age alone as a proxy for to measure programming skill would be.)"

That's exactly the spot where I disagree. Understanding political-economy properly requires a certain amount of cynicism that can only come from observing the world for a while. Very different from programming skill. In programming, "this time it's different" can be true sometimes, we've only got 60-odd years of programming. In political economy, after 3,000 years or so, it's almost never the case.

For what it's worth, I didn't feel that way when I was 22.

Re: Bitcoin heading towards $200, new bubble forming

#94

Post by [deleted] »

snitko wrote: post #92
jbooth wrote: post #90

Earlier quoted context omitted.

When it comes to thinking "this time is different" and "I have an idea to refactor the world economy", your age is VERY relevant. Everyone thinks they have a simple way to fix everything when they're 22. By the time you're 30-40 it's amazing how much smarter the rest of the world got. You can take my word for it as regards politics and investment, or not, it's your money. On the argument, you're implicitly admitting…

> It seems that we agree on the effects of deflationary currency incentivizing not spending money. I'd say a deflationary currency incentivizes less spending, not no spending at all. That's the difference. Now, your point about Bitcoins only being good for storing money, but not for spending. I don't really understand it. Bitcoin is in no way inferior to fiat currencies if you judge it by its properties. In fact, you…

[deleted]

Re: Bitcoin heading towards $200, new bubble forming

#95

Post by jbooth »

snitko wrote: post #92
jbooth wrote: post #90

Earlier quoted context omitted.

When it comes to thinking "this time is different" and "I have an idea to refactor the world economy", your age is VERY relevant. Everyone thinks they have a simple way to fix everything when they're 22. By the time you're 30-40 it's amazing how much smarter the rest of the world got. You can take my word for it as regards politics and investment, or not, it's your money. On the argument, you're implicitly admitting…

> It seems that we agree on the effects of deflationary currency incentivizing not spending money. I'd say a deflationary currency incentivizes less spending, not no spending at all. That's the difference. Now, your point about Bitcoins only being good for storing money, but not for spending. I don't really understand it. Bitcoin is in no way inferior to fiat currencies if you judge it by its properties. In fact, you…

So, less spending = less GDP, right?

Re: Bitcoin heading towards $200, new bubble forming

#96

Post by snitko »

jbooth wrote: post #95
snitko wrote: post #92

Earlier quoted context omitted.

> It seems that we agree on the effects of deflationary currency incentivizing not spending money. I'd say a deflationary currency incentivizes less spending, not no spending at all. That's the difference. Now, your point about Bitcoins only being good for storing money, but not for spending. I don't really understand it. Bitcoin is in no way inferior to fiat currencies if you judge it by its properties. In fact, you…

So, less spending = less GDP, right?

It could be. If someone spends money digging holes, it adds to the GDP, but is it good? Hardly so, because no one else profits from it and no additional value is created. The money are wasted, but it looks good on the paper. So why is GDP so important?

Re: Bitcoin heading towards $200, new bubble forming

#97

Post by Tichy »

jbooth wrote: post #74
snitko wrote: post #48

Earlier quoted context omitted.

Bitcoin is not a ponzi scheme. It's a technology with actual useful properties. The code is out there to see. If you don't understand why these properties are useful to so many people, I welcome you to the third world countries where you can't start selling your product to the rest of the world (even if it's a great one), because PayPal doesn't work with your country and cc processors won't let you accept cards from…

It can't be both? The declining rate of bitcoin generation certainly has ponzi-like properties. It seems like the primary motivation to mine is assuming that the value will go up as mining becomes more difficult.

You might want to read up on Ponzi schemes again. I don't see a connection with declining production rates of a product.

Re: Bitcoin heading towards $200, new bubble forming

#98

Post by maxerickson »

Tichy wrote: post #54
Choronzon wrote: post #17

Earlier quoted context omitted.

Printing money is basically intrinsic to our "real currencies" so if you remove that you have something quantitively different,effectively a new type of currency. Technically currency is a medium of exchange and can be linked to anything,industrial production,gold,number of cows,someones else's currency etc ,so whether it is inflationary or deflationary depends on its social framework and design. Now what is a deflat…

But why does a fixed supply make it deflationary? What happens when all BTC have been mined, will the price still go up all the time? I guess it could go up if the Dollar goes down at the same time. The actual price is staying the same, but the Dollar is worth less, so it takes more to buy X. Not sure why that would be bad. Also I suspect banks will create virtual bitcoin, as they do with money (lending BTC that they…

Well, if you assume economic growth, a fixed number of counting tokens will have to represent larger values over time.

The real trick is to read 'deflationary' as 'will create deflationary pressure', not as 'will inevitably cause deflation at every moment in time'.

Re: Bitcoin heading towards $200, new bubble forming

#100

Post by Choronzon »

enoch_r wrote: post #65
Choronzon wrote: post #4

Earlier quoted context omitted.

Its inherently deflationary anyway (which is a terrible idea for a currency).

It's extremely implausible for everyone to know that the value of ${commodity} will rise steadily, with no risk, for the foreseeable future. Why? Think of the second-order effects of what you're saying--I expect the value of ${commodity} to rise indefinitely, so what do I do? Buy ${commodity}. Or, I own a bunch of ${commodity} and expect the price to rise indefinitely--what do I do if someone offers to buy my ${commo…

"bitcoin is a medium of exchange but not a unit of account." Very true,however from an economic point of view it is a terrible medium of exchange,you have large spread costs,a difficulty sourcing and transferring product,issues of divisibility and and a massive level of price instability relative to the currency being exchanged.

Your example of buyer and seller also makes that point indirectly unless the bit coins are instantly convertible to dollars someone is going to loose out in any price move.

The cheapest way to pay someone in dollars is to actually pay them in dollars.

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