Just coming back to this, managing to lose $25,779?! That must have been pretty damn obvious well before you pulled the plug of people's accounts.

(observation - my account now tells me I have a zero balance)

There is an error, and most people do miss it.  

What you wrote was 2 * 0 = 1 * 0 and that does not prove 2 = 1.

Actually it was quite interesting to wake this morning and see where it had evolved to.  Even more interesting to hear people claim I/we were losing money when at a simple level the tangible coins flow out the other end into people's pockets.  (and perhaps envious that I wasn't around when someone decided to sell div shares at 1.0)

The overall point, is that if you only have a few coins, and do not have a BS&T account, there are a few ways of gaining access to high returns.  We have seen a growth in competing products, but these have taken five or six weeks to come to market, and at least one of them has folded before launch.  Some are backed by well known and reputable members of the forum, others not so well known, and a range of rates/features. 

Despite this, we have still sold 3000 PPT.A bonds this week, have 4000 coins in reserves, found a few places where we broke GLBSE, raised a lot of awareness, had some interesting announcements from Pirate, paid dividends, redeemed two rounds of bonds, and delivered some advantage to a lot of people (I think there were over 100 cleared bids yesterday - not sure how many individuals).

Tomorrow we pay another dividend 0.0289 BTC/share to 9000 shares so the recipients of those payments are not necessarily losing money on PPT. 

Actually, that is not good enough - you are liable and held funds and have a duty to make good.  Even if Chris's suggestion is implemented, you don't get to simply walk away without making good the losses of the people that have placed trust and funds with you.

The assumption is that the loss is an opportunity cost that I would have invested those coins with BS&T.  On that assumption, there is a non-profit maximised result.

However, it is unlikely that I would have taken those coins and done that.  he others may have.  But we do have 4000 coins sitting idle earning no interest, so that is a cost (even if just an opportunity cost).

As has also been pointed out, there is an expected profit from the latest round that (according to Burt's calcs) delivers 221.339BTC that will translate into a dividend of 0.0246 BTC for each PPT.DIV share in four weeks time.  So while there has been an interesting page of math, the end result is a 2.46% return for the person that picked up some dividend shares for 1.0  (the next five dividends currently total 0.24 BTC).

So, while the math boffins are busy, would you like to work out how profitable or not this scheme is for someone simply holding dividend shares and not positing any of the 4000 coins of insurance funding?

What?

No one has paid 1.32, and we have 0.32BTC per bond in a secure wallet earning zero to cover the event of default. 

We "pocket" the difference between the 1.00 and average price and that compensates for having 4k BTC tied up and goes to the PPT.DIV payouts.

And to duplicate the other thread, thanks for looking and thinking about this.  The point you have reinforced is that there is a benefit.  (the degree of benefit depends on individual circumstance)

Thanks for looking and thinking about this.  The point you've demonstrated is that there is a benefit, and it's materially above 1.02.

BTW I used 1.07^4 to make the comparison more realistic.

also, as a question, how did you get 41% return for someone investing at 1.00 and receiving 1.28?

I was looking at this earlier today


From https://bitcointalk.org/index.php?topic=76594.msg922493#msg922493

Depends on the price you pay.  Call it what you will, but buyers below 1.05 will be better off "mathematically".

For those that do not have access to 2000 coins and a 7%/week account, you'll also be better off.

This is OT for this thread.

I believe there are other, earlier threads that talk about BS&T and how it is a scam or otherwise illegal enterprise.  It is also a personal opinion that "curious" was a duplicate account of one of those people and wanted to highlight it to detract from BS&T and towards another, competing investment.

Also, while the PPT was announced back on 13 April, there was a particular reason for doing that, and as you are aware it was due to a market opportunity that had been announced a month earlier.  I was happily providing loans to people around that time at higher projected rates.  Like many activities, the six members of PPT committed risk capital to something that might have failed completely.  Instead, it worked well, spawned copycat schemes and generated envy from people who didn't think of it first.  Similarly, much of the hate that flies around the forum is from people that didn't have their bets pay off.

(Edit: I see you added the newbie PPT thread:  Simple advertising.)

If you're in for a "quick buck" I'm not sure, nor do I need to know.

I don't consider bitcoin or any of the pieces of it as "a quick buck", but then we probably agree to disagree on that point.  If I had wanted that (or the other buddies) then we might have sold the whole thing back then, and having people request access to the profits that we are making (including from today's auction), provided a mechanism for people to do that.  Most of my attention is turning to six-month plus activities rather than capitalising on GLBSE bubbles or other short-term issues, because, I am considering the  longer-term, and hence why I can rationally suggest lower interest rates are probably better than higher.

I could write to Pirate and ask for a reduced interest special rate, but that might be hard for him to implement, and as part of a diversified portfolio, it does actually make sense for me to have assets allocated there.

Not true, but then most of the stuff said about BS&T isn't true.

Plus, no one is keeping me "there" and you obviously were not listening to what I was saying earlier.

I agree (and had been wondering about that.  Plus on the market charts it's going to be additive, so the 30-day totals are going to look weird too.)

Answer A: 1.28
Answer B: My identity is pretty easy to determine, as are some of the others - would you like to meet me face-to-face?

psy, I don't have "a beef"  However, I actually work reasonably hard at what I do, and built my initial deposit with pirate from 70-ish coins to 4000.  I have also helped a few other people get to their next tier of interest.  You also obviously don't understand (and can not actually know) all of the things I'm doing to make my money in the bitcoin world, and speculating on GLBSE is still only a small part of it.  (I know of several people that are doing that much more seriously than I am.)  When/if you have $20k or $100k at risk, then you would also seek to have diversified investments.  For example, there are people with much more than me with Pirate.

I am also not messing around with other people's business.  I have a much lower proportion of my assets deposited with BS&T having dropped from a max around 50% to currently around 20%.

What I was saying is that it makes practical sense to obtain a greater return over a decent time scale than a peaky return that only lasts a short time as the overall payoff is larger.  If you disagree with 5%/wk for six months versus 10%/week for a month, then that is just silly.

I would agree, but then I'm not in the US.  Certainly the timing was not intended to disadvantage anyone.  But, then it's noon here and the PPT.B redemption has just been completed.

Maybe I should be more like "crown of thorns" starfish for self defence and debt collection reasons.

Actually, I don't think any change in interest rates would change the doom-sayers view of the world.

Yes.  Started looking at 100 bonds for 110 coins and then started playing with different purchase prices.

Anyway - redemption for PPT.B is all set and ready to go in 15 minutes.

Edit: 2000 bonds paid 1.28 - should be 2560 coins in people's accounts.

Damn starfish had a math fail - I was playing with the numbers and didn't update the words properly - gone back to edit the post.

It should have been [(110 / 1.05) = 104.8] * 1.28 = 134, so profit is 134-110 = 24

The lazy Starfish likes the poll and has actually said interest rate is a bit high.

However, before someone shoots me, I'm thinking about the longer term and not the nice ride that the past six months has delivered.  There are some structural things that can be done to improve the whole deposit/interest rate trade-off to promote the business, and while 7% is nice for another month, even if it was 5% for another six months that would be better.

You math and logic are flawed, but similar in tone to many of your other forum posts which I find generally negative. Therefore, to point out the situation a little more clearly, to reserve coins rather than investing them may lower your payout and your claim that anyone paying more than 1.02 would be better off else where is not true.

Case 1, invest 110 coins in PPT at a buy in price of 1.05 (104.8 bonds)
Payout is either 134 coins for a profit of 24 coins, or in the event of a default, you receive 32 coins for a net loss of 88.

Case 2, Also starting with 110 coins, reserve 32 coins as self insurance, and put 88 coins into an uninsured scheme.
Position is either 32 + 78 * 1.28 = 134 (also a profit of 24) including weekly compounding, or you retain the 32 coins you started with.

There is a cross-over point, but in case #2 you have two single person points of default (Pirate and whoever your middle-man is).  In case #1, the PPT founders have more at stake than just the PPT business.  People have chosen to value these factors.

Also, in reference to Otoh's point, we have quite a lot of backup, hence Burt is off holidaying, and I'm doing the redemption (2560 coins shortly) and bond sale (3000) this week because it is not automatic.