This doesn't prove he's wrong (whoever you're referring to, no quote). It only shows that the rich are getting richer faster. It says nothing about the richness of everyone else. |
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Virtually all nations have a central bank based upon the fiat model, and virtually all are controlled by the same cartel.
I've only been bouncing around this thread, but what are you implying here? Exactly what cartel controls all the central banks in the world? I am making a correction to my statement above in bold. A search engine can answer that question. I did a search and found that this page has some good answers; you do have to read the whole page from top to bottom (including comments) to get a real understanding, so I will not be quoting any short answers: http://henrymakow.com/2013/07/do-the-rothschilds-own-all.htmlOk, yeah, so as I thought. Jewish illuminati tinfoil hat fodder. This nonsense invalidates all your other comments in this thread. |
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First, income on an investment means return on capital. If you buy a bitcoin, 100 years later, you still have a bitcoin. There's been no income, and there will never be any income associated with owning a bitcoin.
That is not to be confused with capital appreciation. If you buy a bitcoin for 100 dollars, and later sell it for 200 dollars, you have realized capital appreciation. Bitcoin only affects your wealth through capital appreciation or depreciation. There is no underlying business that creates profit, like with stocks and bonds. A stock can affect your wealth through capital appreciation and through income distribution, where it pays a portion of current profits to the owners.
So no, the income from bitcoin is not much higher than any kind of stocks and bonds, because there is no income associated with bitcoin. And you can't make that argument for capital appreciation either, because bitcoin is down 67% from it's high price in 2013. Odds are that anyone who bought bitcoins any time in 2014 is still sitting on a loss.
You did not count in the purchasing power loss of fiat money, which makes all the calculations here irrelevant. I get double amount of dollars, that does not mean the purchasing power is higher than the time I purchased bitcoin, since everything else's price could have also risen against dollar by 100% All the current business calculation is based on a hidden indication that fiat money have a fixed value, which is definitely not true for anyone can see the whole picture. USD has lost most of its value in the past century and even now it is depreciating against all capital goods at an amazing speed Unless you bought exact in the bubble top, if you calculate the price of bitcoin with Ruble, you will easily see that everyone who bought bitcoin with Ruble has already returned to profit, early investors have gained hundreds of times in terms of Ruble Inflation is not high, so your comment about that doesn't provide anything useful. And you completely missed the point since I wasn't speaking about specifics, but illustrating the difference between investment income and capital appreciation. USD is not depreciating at an amazing speed. Current inflation is around 1%, which is historically very low. Compare a very low depreciation rate to bitcoin, which can't hold stable value hour to hour, and there's no question as to which of the two is better suited to store value. |
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I think that price doubles every 4 years are still guaranteed, so the incentive holds
The only thing that stood out in that long post was this line. Nothing related to price is guaranteed. Price has to keep up with the rise in computing power on the network for miners to earn consistent returns. If price doesn't keep up, mining income falls. At the halving, my prediction is it forces a lot of miners out of the market who can't mine enough to break even. |
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Chinise are not devaluating currency.Yuan has lost only 4%to dollar last time.Look Euro and dollar.Look Yuan rates and dollar and Euro rates
Now will be big crash,so hold your btc,crash done by westerness debt economy, derivatives,one big boom
China is devaluing the yuan. They've kept it pegged to a very tight range for over 20 years, but are now actively devaluing it. The yuan is trading at about 6.46 to the U.S. dollar, its lowest level since 2011. Also called the renminbi, the currency has lost 3.5% against the dollar this year.
It all started back in August, when China stunned markets by announcing a 2% devaluation -- the biggest one-day fall in the yuan in more than two decades.
The slide has continued since, and further losses are likely -- analysts say -- following the International Monetary Fund's decision to promote the yuan to its elite basket of global currencies from October next year.
That's because China will face more pressure than ever to show its commitment to economic reforms, and further relax its grip on the yuan.
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The shear numbers are of course increasing. But that has more to do with currency inflation than actually borrowing more money. Every major country on the planet has some debt, just like most people in this world have some financial debt. Its life. IMO what matters is not so much the total debt a country has, but the ratio of debt to GDP. That gives you an idea of how easily a country would actually be able to pay off its debt. In the case of the US, the ratio is estimated between 104-105% which is to say its essentially a 1:1 ratio. The GDP in the United States is about equal to its debt. That's pretty common and not really all that alarming. The ratio for the entire eurozone is about ~94% with some countries well above 100% Is debt high in the US? Yes certainly. But is it so bad that we need to stop everything and fix it now? No its not. By comparison, Greece who almost defaulted earlier this year, is somewhere north of 180% http://www.debtclocks.eu/Taking a snapshot at any individual moment isn't as useful as identifying the overall trend. In the past 15 years, debt:GDP ratio has risen 147% (from under 45% to over 110%). GDP Debt (FYE) Ratio Dec 31, 2014 16.15 trillion 17.82 110.34% Dec 31, 2013 15.76 trillion 16.74 106.22% Dec 31, 2012 15.38 trillion 16.07 104.48% Dec 31, 2011 15.19 trillion 14.79 97.37% Dec 31, 2010 14.94 trillion 13.56 90.76% Dec 31, 2009 14.54 trillion 11.91 81.91% Dec 31, 2008 14.58 trillion 10.02 68.72% Dec 31, 2007 14.99 trillion 9.01 60.11% Dec 31, 2006 14.72 trillion 8.51 57.81% Dec 31, 2005 14.37 trillion 7.93 55.18% Dec 31, 2004 13.95 trillion 7.38 52.90% Dec 31, 2003 13.53 trillion 6.79 50.18% Dec 31, 2002 12.96 trillion 6.23 48.08% Dec 31, 2001 12.71 trillion 5.81 45.71% Dec 31, 2000 12.68 trillion 5.68 44.79% Is a 110% ratio problematic? That single data point alone doesn't say. But in light of the trend (we were under 45% 15 years ago) and with medicare and social security expenses about to start exploding with the retiring baby boomers, yeah, it absolutely is crucial we address this now. We haven't at all over the last 15 years, despite knowing this looming crisis was coming, and we did nothing. We don't have the luxury of not acting anymore, or hoping that we can economic-growth our way out of this. We can't. Exactly. In healthy economy, budget deficit during recession periods is compensated by proficit during expansion periods. If government has persistent deficit, exhausts reserves and continues to accumulate the debt for many years in a row, it is not a recession, it is a depression. All so called "wealthy" countries are in a state of depression right now. Their governments increase dept to hide pathological economical problems. By doing this, they are just shifting a collapse to the future. This can not last for long. Pretty much the entire world is in some form of depression right now, US and Russia included. Russia's economy is collapsing, 4% GDP recession each of the last 2 quarters. The Ruble is down by nearly 50% since this time last year. Countries like the US are borrowing money to cover budget shortfalls, while countries like Russia are spending assets to do the same. Its just a difference in philosophy. Look at those numbers you posted a little closer. From 2000 to 2007 it rose 16% in the US. In 2008 the US economy took a nose dive, and it rose 8%. Then an additional 13% in 2009, followed by 9% in 2010. So in 3 years from 2007-2010 the US increased its debt to GDP ratio at more than double the rate of the previous 7-8 years. The government was borrowing money to cover itself until things stabilized and they're able to pay it down. Now that the economy is turning around the budget is becoming a big political topic here in the US and I expect something will be done about it soon.I don't share this optimism. When republicans control things, they insist on tax cuts because the deficit is small. This makes absolutely no sense. If there is any deficit at all, it means the government isn't taking in enough revenue to cover its expenses. So tax cuts are the last thing it needs. It is always promised that tax cuts will improve the economy and bring in more revenue than the cuts cost, but this has never proven out. I fully expect that whatever party is in control after the next election, the deficit spending will continue, and republicans will talk about cutting taxes, regardless of whether they are in the majority or minority position. |
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The shear numbers are of course increasing. But that has more to do with currency inflation than actually borrowing more money. Every major country on the planet has some debt, just like most people in this world have some financial debt. Its life. IMO what matters is not so much the total debt a country has, but the ratio of debt to GDP. That gives you an idea of how easily a country would actually be able to pay off its debt. In the case of the US, the ratio is estimated between 104-105% which is to say its essentially a 1:1 ratio. The GDP in the United States is about equal to its debt. That's pretty common and not really all that alarming. The ratio for the entire eurozone is about ~94% with some countries well above 100% Is debt high in the US? Yes certainly. But is it so bad that we need to stop everything and fix it now? No its not. By comparison, Greece who almost defaulted earlier this year, is somewhere north of 180% http://www.debtclocks.eu/Taking a snapshot at any individual moment isn't as useful as identifying the overall trend. In the past 15 years, debt:GDP ratio has risen 147% (from under 45% to over 110%). GDP Debt (FYE) Ratio Dec 31, 2014 16.15 trillion 17.82 110.34% Dec 31, 2013 15.76 trillion 16.74 106.22% Dec 31, 2012 15.38 trillion 16.07 104.48% Dec 31, 2011 15.19 trillion 14.79 97.37% Dec 31, 2010 14.94 trillion 13.56 90.76% Dec 31, 2009 14.54 trillion 11.91 81.91% Dec 31, 2008 14.58 trillion 10.02 68.72% Dec 31, 2007 14.99 trillion 9.01 60.11% Dec 31, 2006 14.72 trillion 8.51 57.81% Dec 31, 2005 14.37 trillion 7.93 55.18% Dec 31, 2004 13.95 trillion 7.38 52.90% Dec 31, 2003 13.53 trillion 6.79 50.18% Dec 31, 2002 12.96 trillion 6.23 48.08% Dec 31, 2001 12.71 trillion 5.81 45.71% Dec 31, 2000 12.68 trillion 5.68 44.79% Is a 110% ratio problematic? That single data point alone doesn't say. But in light of the trend (we were under 45% 15 years ago) and with medicare and social security expenses about to start exploding with the retiring baby boomers, yeah, it absolutely is crucial we address this now. We haven't at all over the last 15 years, despite knowing this looming crisis was coming, and we did nothing. We don't have the luxury of not acting anymore, or hoping that we can economic-growth our way out of this. We can't. |
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...
jaysabi
And those debt numbers are JUST the officially acknowledged US National Debt. Depending on whose numbers you believe, those debts (inc. unfunded liabilities) could be from $80 trillion to $220 trillion.
If the FED raises rates this month, the interest rates will cause our debts to rise even faster. Ugh.
Well, it's what the debt actually is at present. Unfunded liabilities are not current debts, they are future debts. The law mandating their payment could change, or the demographics underlying their calculation could change before they actually need to be paid, or revenue could more than make up the difference by the time they are incurred in which case they wouldn't add to the debt at all. In any case, I didn't include them in my post because they're speculative. The debt numbers posted are the Treasury's numbers of debt currently incurred, but you're right that you shouldn't ignore the looming crisis unfunded liabilities pose, which is exactly what every politician is presently doing. |
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 First 224 years of existence: 5.674 trillion dollars Next 8 Bush years: 4.350 trillion dollars Next 7 Obama years: 8.126 trillion dollars Compare what we've done in the last 15 years to what we did in the first 224 years. We've more than tripled in the last 15 years what it took 224 years to accumulate in debt. To be lazy and use stereotypes, democrats spend too much and republicans tax too little. The truth is that both parties spend too much and tax too little. The current war spending is not sustainable. The current tax rates are not sustainable. Social Security and Medicaid are about to explode in expenditures. You simply cannot cut this level of debt by only cutting spending or only raising taxes. It will take substantial efforts on both ends to put things in order, and then it will take disciplined restraint and political will to stay on course over several decades to begin to fix this process. Frankly, our politicians are not up to the challenge. Their incentive is re-election every 2 or 4 years, and this type of outlook is incompatible with the long-term approach necessary to fix what an utter mess the national finances have become. |
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On the other hand, there aren't many merchants who accept it presently who actually hold bitcoin. Rather, they use payment processors who accept payment in bitcoin on their behalf and immediately convert the transaction into USD. The value of bitcoin is not stable enough to let businesses use it with any confidence that they won't lose money on their transactions, so it is far safer to immediately convert to fiat and pay a small fee in order to serve a niche market that wants to pay in bitcoin.
Exactly, that's the reason merchant acceptance does not affect bitcoin's value, it is mainly decided by the capital inflow, which comes from people's demand for saving. For the most part, we agree here. Merchants have a negligible effect on bitcoin's price. Current gentle inflation monetary policy already removed the possibility to use fiat money for saving, then this demand must find a suitable currency, which is bitcoin
Don't agree here. Bitcoin is a terrible choice for holding long term value due to it's historic and extreme volatility. The USD is far superior in every aspect for saving, and USD will continue to be fine for saving for the foreseeable future. |
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An investment in stocks and bonds (which represent an ownership stake in a business) is not comparable to bitcoin, which has no potential to create income. It is the ownership stake in a business which gives stocks and bonds their value. Anything can have value, yes, we agree on this. But I wasn't disputing this. My point was that utility gives value, and altcoins have no utility, which is why they only go down in value. It doesn't take much to accept an altcoin as a merchant, literally just an address which you can set up in less than a minute. The reason they don't is because it's not even worth that little effort.
The income brought by bitcoin is already much higher than any kind of stocks and bonds. If the stock/bond price fall 20% while you get a 2% dividend/interest, that is a loss not income Bitcoin's biggest utility is to bring you income long term wise. Altcoin is much more risky because their function can all be done in bitcoin, and to concentrate the effect of investment, capital usually goes to the strongest network First, income on an investment means return on capital. If you buy a bitcoin, 100 years later, you still have a bitcoin. There's been no income, and there will never be any income associated with owning a bitcoin. That is not to be confused with capital appreciation. If you buy a bitcoin for 100 dollars, and later sell it for 200 dollars, you have realized capital appreciation. Bitcoin only affects your wealth through capital appreciation or depreciation. There is no underlying business that creates profit, like with stocks and bonds. A stock can affect your wealth through capital appreciation and through income distribution, where it pays a portion of current profits to the owners. So no, the income from bitcoin is not much higher than any kind of stocks and bonds, because there is no income associated with bitcoin. And you can't make that argument for capital appreciation either, because bitcoin is down 67% from it's high price in 2013. Odds are that anyone who bought bitcoins any time in 2014 is still sitting on a loss. |
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Virtually all nations have a central bank based upon the fiat model, and all are controlled by the same cartel.
I've only been bouncing around this thread, but what are you implying here? Exactly what cartel controls all the central banks in the world? |
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For traditional money, you need merchant acceptance to be useful, so it never goes beyond boarder of a country. But bitcoin is more universal form of money, you don't really need merchants to accept the payment, you can easily exchange to what ever currency they accept. It is amazing that you can exchange it to any currency on localbitcoins, no other currency in the world have this kind of worldwide exchangeability
This isn't entirely accurate. If you could do nothing with bitcoin but convert it to fiat, then it would have low utility and low value. It is only because you can purchase things with bitcoin that it has value. Look at all the altcoins that serve no market function: they're all virtually worthless because the only thing you can do with them is exchange them from bitcoin to the altcoin and back. No one accepts them for any goods and services, so they have no value because they don't serve a function. There's no point to them. There are many financial products that you can not find any merchant accepting them for goods and services: Bonds, stocks, options, futures, gold etc... But they usually worth a lot. From a pure financial point of view, as long as there is exchange, anything that have value is interchangeable. Similarly, those altcoins also have value if you can sell them for bitcoin and then sell bitcoin for fiat money. The reason that merchants do not accept altcoin is because their infrastructure is magnitudes weaker than bitcoin, and it is enough to have one cryptocurrency in merchants many different payment options An investment in stocks and bonds (which represent an ownership stake in a business) is not comparable to bitcoin, which has no potential to create income. It is the ownership stake in a business which gives stocks and bonds their value. Anything can have value, yes, we agree on this. But I wasn't disputing this. My point was that utility gives value, and altcoins have no utility, which is why they only go down in value. It doesn't take much to accept an altcoin as a merchant, literally just an address which you can set up in less than a minute. The reason they don't is because it's not even worth that little effort. |
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The reality is, throughout human history, money's value has never come from transaction demand, be it grain, gold, or fiat money. It comes mainly from the property that it can be trusted to hold value in a relatively long time, and secondly it can be accepted widely
The grain is useful in feeding us, so it has value. The fiat money has no value if it is not used in transaction, or if it cannot be used to buy things. The value of bitcoin is from the trust we can use it to buy things. If your fiat money lose half of its value every day (e.g. everything's price doubles every day), then even every merchant accept it as payment, you will get rid of it as quick as possible. To be able to store value over a long time is the most import prerequisite for any kind of money. You can observe that when bitcoin price rises, merchant acceptance are higher, since it can hold value very well. When the price falls, more merchant will refuse to accept it On the other hand, there aren't many merchants who accept it presently who actually hold bitcoin. Rather, they use payment processors who accept payment in bitcoin on their behalf and immediately convert the transaction into USD. The value of bitcoin is not stable enough to let businesses use it with any confidence that they won't lose money on their transactions, so it is far safer to immediately convert to fiat and pay a small fee in order to serve a niche market that wants to pay in bitcoin. |
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Been saying this for the last 2-years, the Yuan IS going to become the world's reserve currency. Better trade those greenbacks into something worth something very soon.
With the Chinese intentionally devaluing the Yuan and a history of intentional value manipulation, the Yuan has a steep mountain to climb to become the world's reserve currency. |
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I'm not sold on the premise that Chinese citizens are "looking to get their money out of the Yuan." The Chinese government is actively pumping the Chinese stock market and attempting to entice people to invest in it. It seems more likely that people will chase the bubble there than look to get their money out of the Yuan all together.
Second, if people are looking to get their money out of the Yuan, bitcoin is only a temporary transfer method, at best. They're not looking to convert to bitcoin and hold, they're looking to convert to bitcoin, move their money outside of the country, and convert to something more stable like the Euro or USD. In that case, any purchasing pressure this activity causes would be canceled by the selling pressure, with a net of zero. But this still seems unlikely to be happening on a scale large enough to matter.
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Zombies in space. Well 21M will never happen because there are plenty lost. If there's no more BTC to mine then we could all agree that Bitcoin had come a long way if it's still alive by that time.
21M will still be minted. There's a difference between the number circulating (active supply) and the number existing (total supply). Coins lost decrease active supply, the total supply will still be 21 million. However, as far as price per coin is concerned, only active supply will matter. |
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For traditional money, you need merchant acceptance to be useful, so it never goes beyond boarder of a country. But bitcoin is more universal form of money, you don't really need merchants to accept the payment, you can easily exchange to what ever currency they accept. It is amazing that you can exchange it to any currency on localbitcoins, no other currency in the world have this kind of worldwide exchangeability
This isn't entirely accurate. If you could do nothing with bitcoin but convert it to fiat, then it would have low utility and low value. It is only because you can purchase things with bitcoin that it has value. Look at all the altcoins that serve no market function: they're all virtually worthless because the only thing you can do with them is exchange them from bitcoin to the altcoin and back. No one accepts them for any goods and services, so they have no value because they don't serve a function. There's no point to them. |
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From here: http://www.bitcoinfuturesguide.com/bitcoin-blog/arthur-hayes-of-bitmex-chinese-exchanges-are-operating-as-shadow-banksArthur Hayes, CEO of Seychelles-based bitcoin futures exchange BitMEX, has come out with an explosive speculation about Chinese spot exchanges 0% fee model. Many people have wondered how they make money with this business model, and Arthur makes a strong case for how they logically must be investing customer deposits into speculative Chinese debt instruments. Read the latest BitMEX newsletter here: http://us3.campaign-archive2.com/?u=db45c09bdf20e1866bb32123f&id=2b42af456a&e=a725d34609Essentially it boils down to: these exchanges don't make money by charging 0% on trading fees, and make a pittance from withdrawal fees, so they have to be making a revenue stream somehow. And since they are taking in loads of CNY deposits which they otherwise only credit into their own database for customers to use to trade, then OKCoin, Houbi, and BTCC are taking those customer deposits (most of them at least) and investing in 10-20% "Wealth Management Products" (WMPs). Arthur points out that the main cause of this is the excessive demand for private credit. Because Chinese state owned enterprises have exclusive access to bank credit, small private companies have to use shady means to get financing, and institutions with excess cash take on a bank-like role, aka shadow bank. It's a very likely scenario and it's not necessarily a bad thing. As long as the speculative debt that the Chinese exchanges are investing the customer deposits in doesn't go bad, then the deposits of customers is safe, and the traders that are using balances reflecting these deposits are robust. However, if things get messy in China, leading to problems with debt repayments, then it may spill over and affect the bitcoin market too. This is a fantastic theory about the 0% fee Chinese exchanges. I have long wondered what benefit there is to running an exchange that charges no commissions, and this makes sense. If it's true, I don't see this ending well for anyone trading on those exchanges, as people chasing these WMPs and their return of 10-20% are just chasing yield to make a quick profit. Generally, people who chase yield don't weigh the risk-reward carefully, and things with yields that high are generally quite risky. China as a whole isn't a place I'd want to invest in the first place because the government is actively pumping the stock market, then add on top of that pump that these guys are investing in the most risky class of assets there, and this ends badly. Alas, this is speculation, as Arthur admits he has nothing to substantiate his theory. Interesting nonetheless. |
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I personally think that November was simply a month full of market manipulations and still till now ... It went till nearly 500$ last time and now it's pumping once again without any apparent reason , the only explanation is that there is some manipulations by the big exchange (chinese most likely) .
The lemming mentality perhaps where people see a big swing and pile on, adding momentum to the upswing. It makes for a steep and swift drop when the buying slows as people then begin panic selling for fear they bought into a bubble. The swings can vary in duration from a few days to weeks or months, but a momentum-pendulum on crack and fueled by speculators pretty accurately describes how bitcoin trades. |
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