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Author Topic: Speculators  (Read 3381 times)
tomcollins
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May 26, 2011, 09:25:58 PM
 #21

Man, if he does that, buys up a bunch, then crashes it, it sure would suck to sell to him for a high price and then buy back when low.  He'll sure show us!

Right now it wouldn't do much since not many people use the currency in real world transactions.  Also if he had most of the money he could control the price.

He would never have most of the money. If he tried to buy it all, the price would skyrocket, he would make us all rich and he would hold a bunch of bitcoins that nobody else used. If he then tried to sell them, he would have to do so an absurdly low price. Essentially, he would make himself doubly poor and us doubly rich.

If he was not self-interested, he of course could destroy the currency.

But Bazil needs to research the Hunt Brothers and how that worked out for them before thinking it will work.

Most manipulation works by scaring people into doing stupid things.  Say he wanted to buy a lot of bitcoins for cheap.  He buys a lot at the market rate over time.  Then he sells them all at once to drive the price down to extremely low levels.  Everyone else freaks out and thinks that they better sell now before they are totally worthless!  This drives the price even lower.  Eventually he buys them back up.  It's tricking people into selling when they shouldn't, or buying when they shouldn't.  For example, on his buying rush, he might have a lot already that he purchases.  Then buy a bunch all at once to drive the price up.  People might think it's going to continue forever, so they start buying more and more after the catalyst kicked it off.  Then he sells when it was driven up even more at a slower rate until he makes profit.

This only works if people are too slow to act or they can get scared into doing something stupid.  Or if he wants to give up a lot of money just to destroy it.

Bazil is just using boogeymen though "I'm not sure how he'll do it, BUT HE WILL FIND A WAY BECAUSE HE IS AN EVIL GENIUS!"
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BitterTea
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May 26, 2011, 09:29:23 PM
 #22

You should read about him.  I'm sure he could come up with a way where the opposite was true.

You're right, he's a super villain with super currency manipulation powers. The laws of supply and demand do not apply to him.

From the Wikipedia article you linked...

Quote
The financial crisis that originated in Thailand in 1997 was particularly unnerving because of its scope and severity.... By the beginning of 1997, it was clear to Soros Fund Management that the discrepancy between the trade account and the capital account was becoming untenable. We sold short the Thai baht and the Malaysian ringgit early in 1997 with maturities ranging from six months to a year. (That is, we entered into contracts to deliver at future dates Thai Baht and Malaysian ringgit that we did not currently hold.) Subsequently Prime Minister Mahathir of Malaysia accused me of causing the crisis, a wholly unfounded accusation. We were not sellers of the currency during or several months before the crisis; on the contrary, we were buyers when the currencies began to decline – we were purchasing ringgits to realize the profits on our earlier speculation. (Much too soon, as it turned out. We left most of the potential gain on the table because we were afraid that Mahathir would impose capital controls. He did so, but much later.)

Also, perhaps your bias prevented you from noticing this part of the article.
Bazil
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May 26, 2011, 10:46:34 PM
 #23

You should read about him.  I'm sure he could come up with a way where the opposite was true.

You're right, he's a super villain with super currency manipulation powers. The laws of supply and demand do not apply to him.

From the Wikipedia article you linked...

Quote
The financial crisis that originated in Thailand in 1997 was particularly unnerving because of its scope and severity.... By the beginning of 1997, it was clear to Soros Fund Management that the discrepancy between the trade account and the capital account was becoming untenable. We sold short the Thai baht and the Malaysian ringgit early in 1997 with maturities ranging from six months to a year. (That is, we entered into contracts to deliver at future dates Thai Baht and Malaysian ringgit that we did not currently hold.) Subsequently Prime Minister Mahathir of Malaysia accused me of causing the crisis, a wholly unfounded accusation. We were not sellers of the currency during or several months before the crisis; on the contrary, we were buyers when the currencies began to decline – we were purchasing ringgits to realize the profits on our earlier speculation. (Much too soon, as it turned out. We left most of the potential gain on the table because we were afraid that Mahathir would impose capital controls. He did so, but much later.)

Also, perhaps your bias prevented you from noticing this part of the article.

What bias?  All I'm saying is I don't think this currency will be stable over time.  I only used Soros' antics as an example.

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May 27, 2011, 04:26:31 AM
 #24

What y'all seem to be ignoring or understating is the utility to CRINIALS. Don't get me wrong, I see a huge difference between "illegal" and "immoral" so I'm not using the term pejoratively. Just as the internet itself and VCRs before that were largely technologies first adopted by the pornography industry, it will be criminals who will use Bitcoin first on a large scale. By the time the governments of the world get serious about stopping it, it will be far too late. This is a very, very good thing. Markets want to be free. We have a rare opportunity to profit tremendously by doing the right thing here and taking Bitcoin mainstream.

The caveat is that speculation can be overdone when leverage is used. BTC is definitely not ready for primetime yet and wide use of margin can collapse the price if liquidity is rapidly removed. selling into a bidless market is every investor's nightmare. When you get your margin call, you are wiped out. I suggest any leveraged speculators to Google "Bunker Hunt" for a specific cautionary tale concerning this peril.

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May 27, 2011, 05:16:30 AM
 #25

Everyone is a criminal. There are 10k+ laws and you don't know them and can't follow them. Criminal has been synonymous with person for a long while now.

Unless you mean something else by crinials. I don't know what it could be, but I also don't know how you can misspell a word you put in all caps.

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BitterTea
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May 27, 2011, 05:27:56 AM
 #26

Everyone is a criminal. There are 10k+ laws and you don't know them and can't follow them. Criminal has been synonymous with person for a long while now.

Unless you mean something else by crinials. I don't know what it could be, but I also don't know how you can misspell a word you put in all caps.

Somebody needs to place an order on Silk Road. Wink

This is a very, very good thing. Markets want to be free.
bitcoinfrenzy
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May 27, 2011, 06:06:37 AM
 #27

What y'all seem to be ignoring or understating is the utility to CRINIALS. Don't get me wrong, I see a huge difference between "illegal" and "immoral" so I'm not using the term pejoratively. Just as the internet itself and VCRs before that were largely technologies first adopted by the pornography industry, it will be criminals who will use Bitcoin first on a large scale. By the time the governments of the world get serious about stopping it, it will be far too late. This is a very, very good thing. Markets want to be free. We have a rare opportunity to profit tremendously by doing the right thing here and taking Bitcoin mainstream.

The caveat is that speculation can be overdone when leverage is used. BTC is definitely not ready for primetime yet and wide use of margin can collapse the price if liquidity is rapidly removed. selling into a bidless market is every investor's nightmare. When you get your margin call, you are wiped out. I suggest any leveraged speculators to Google "Bunker Hunt" for a specific cautionary tale concerning this peril.

Who is buying on margin?  How can you even do that?  As I understand it the exchange does not allow for margin, is there something I am missing?

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May 27, 2011, 09:21:47 AM
 #28

Heard about Bitcoin recently.  Seems I missed the gravy train on this one.  Looking over at mtgox it seems like speculators are driving the price of bitcoins up.  Also it's hard to get in since they don't accept pay pal Tongue

[...SNIP...]

but the way the system is now seems like a scam to make billionaires out of the early adopters to me (if it works).


Just thinking out loud here, but a better system I think would automatically set set the bitcoin creation difficulty based on the current usage.  That way the currency would always have a rock hard steady value.  If someone horded a bunch only to release them all at once, the creation of coins would automatically become almost impossible until the market absorbed the extra currency.  Just an idea, athlough it may be more hackable I don't know.

[...SNIP...]

You can have your own entire bitcoin-type currency, all 21 million coins of it all to yourself, for only a few programmer-hours, maybe even less than one programmer-hour (if programmer knows exactly what to do and how to do it and is willing to sell time in blocks of a few hours or less), and many programmers still accept PayPal as far as I know.

So you have not in fact missed the gravy train, you have failed to buckle down and build it. Smiley

(If you think you'd simply be scamming people to make yourself into a billionaire though I suppose you might be doomed to not only missing gravy trains but failing to create gravy trains too.)

Canadian Digital Notes (CDN), United Kingdom Britcoins (UKB), Bitnickels (NKL) and others along those lines can still be had for as little as one CAD, GBP, or actually-made-of-nickel old U.S. nickel though I think, and some seem to think those are a buyer's market right now (as in, they doubt anyone will even buy any so aren't busy driving the price up so fast that you are about to miss the gravy train on those too...)

-MarkM-

P.S. if you think a bitcoin shortage will be a problem some day, get in on alternatives before that day comes! Smiley

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Bazil
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May 27, 2011, 02:12:19 PM
 #29


P.S. if you think a bitcoin shortage will be a problem some day, get in on alternatives before that day comes! Smiley


Yep, I plan to ride the train as long as it still on the tracks.  Even if Bitcoin does become a big time world currency it will have to be replaced by something eventually.

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markm
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May 27, 2011, 06:04:39 PM
 #30


P.S. if you think a bitcoin shortage will be a problem some day, get in on alternatives before that day comes! Smiley


Yep, I plan to ride the train as long as it still on the tracks.  Even if Bitcoin does become a big time world currency it will have to be replaced by something eventually.

There is a client being developed that is agnostic as to various details about the blockchain-based currency it works with, you tell it about them using config files giving it details such as what port to use for that currency, what genesis block to use, how many coins if any it mints per block and so on. Initial testing and ddeveloment is being done using original bitcoins, testnet bitcoins, beertokens and so on. Once it is nice and easy to install and use likely we'll be spammed with endless streams of config files for more and more new currencies one could choose to use it with if one so desired.

Various Freeciv Galactic Milieu nations are already brainstorming about how much of their own various currencies to offer for how many of each of the various new currencies this new client will allow to proliferate they should consider buying to add to their own currency reserves as diversified backing for their own currencies...

-MarkM-

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Dobrodav
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May 27, 2011, 11:55:57 PM
 #31

I am think that there is 2 outcomes for BTC if it becomes popular.
First (less liked) - regional banks that have contracts with regional services, so BTC will stay inside the bank system mostly.
Second (more likely) - used only for currency-BTC-currency transactions.

We will  meet in not-so-distant future.
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May 28, 2011, 04:15:39 AM
 #32

What y'all seem to be ignoring or understating is the utility to CRINIALS. Don't get me wrong, I see a huge difference between "illegal" and "immoral" so I'm not using the term pejoratively. Just as the internet itself and VCRs before that were largely technologies first adopted by the pornography industry, it will be criminals who will use Bitcoin first on a large scale. By the time the governments of the world get serious about stopping it, it will be far too late. This is a very, very good thing. Markets want to be free. We have a rare opportunity to profit tremendously by doing the right thing here and taking Bitcoin mainstream.

The caveat is that speculation can be overdone when leverage is used. BTC is definitely not ready for primetime yet and wide use of margin can collapse the price if liquidity is rapidly removed. selling into a bidless market is every investor's nightmare. When you get your margin call, you are wiped out. I suggest any leveraged speculators to Google "Bunker Hunt" for a specific cautionary tale concerning this peril.

Who is buying on margin?  How can you even do that?  As I understand it the exchange does not allow for margin, is there something I am missing?

it's simple, you borrow money and invest in bitcoin. Put on your credit card or a signature loan. or rather don't, because that's how the real estate market crashed.

insert coin here:
1Ctd7Na8qE7btyueEshAJF5C7ZqFWH11Wc

Open an exchange account at CampBX: options, lowest commissions, and best security
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