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Author Topic: Bitcoin is a bubble.  (Read 8945 times)
gongcheng
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June 07, 2011, 02:22:36 AM
 #1

From the financial point of view, it is easy to suspect that bitcoin is a bubble.

Most of us believe in the price on Mt Gox. But the price is not reliable.

We can see that there are only around 50k BTCs traded by several hundreds users on Mt Gox every day. Therefore the price can be control very easily.

Suppose I have 50k BTCs, I can register around 100 accounts on Mt Gox and distribute all my Bitcoins into these accounts and then I trade with myself from one account to other, every trade with a higher price. By this operations, I can easily drive up the price to whatever I want to drive.

After more people get into the trade, I will sell the BTCs gradually to avoid the collapse of the price.

You can see this analysis really make sense, because by doing so I can earn about 50k*18=900k, that's around 1 million us dollars according to the price today.

Anybody agree or disagree with me?

Can you give your argument?

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DATA COMMANDER
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June 07, 2011, 02:24:57 AM
 #2

You could try that, but it would be a huge risk since you'd be spending more than 1% on each trade.

Tips are appreciated (very tiny tips are perfectly okay!) 13gDRynPfLH3NNAz3nVyU3k3mYVcfeiQuF
gigitrix
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June 07, 2011, 02:27:03 AM
 #3

Anything that performs well and then badly is retroactively referred to as a bubble. It can only be a bubble if it pops, which no evidence points towards it doing any time soon.
DATA COMMANDER
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June 07, 2011, 02:29:13 AM
 #4

Someone should research everything that's been called a bubble when it started and figure out how many of those things actually turned out to be bubbles. I'd kick in a few bitcents if someone put a bounty on this.

Tips are appreciated (very tiny tips are perfectly okay!) 13gDRynPfLH3NNAz3nVyU3k3mYVcfeiQuF
broker11
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June 07, 2011, 02:32:52 AM
 #5

A bigger Mt Gox problem may be that it is the one dominant place to convert to BTC.

If it is taken down there would be a real problem bringing more dollars into BTC. 
gongcheng
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June 07, 2011, 02:36:04 AM
 #6

You could try that, but it would be a huge risk since you'd be spending more than 1% on each trade.

This is not a problem, because in the beginning I started with nothing, only 50k BTCs which worth nothing.

gongcheng
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June 07, 2011, 02:38:49 AM
 #7

Anything that performs well and then badly is retroactively referred to as a bubble. It can only be a bubble if it pops, which no evidence points towards it doing any time soon.

You have not point out is there anything with my argument.

gongcheng
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June 07, 2011, 02:40:53 AM
 #8

Someone should research everything that's been called a bubble when it started and figure out how many of those things actually turned out to be bubbles. I'd kick in a few bitcents if someone put a bounty on this.

you can send me a few bitcents by this address:
167WiVPxF6FP6WBfPShRQzj9QrvFNJ8AZX

because here is quit a few examples about economic bubbles:
http://en.wikipedia.org/wiki/Economic_bubble


DATA COMMANDER
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June 07, 2011, 02:47:18 AM
 #9

Someone should research everything that's been called a bubble when it started and figure out how many of those things actually turned out to be bubbles. I'd kick in a few bitcents if someone put a bounty on this.

you can send me a few bitcents by this address:
167WiVPxF6FP6WBfPShRQzj9QrvFNJ8AZX

because here is quit a few examples about economic bubbles:
http://en.wikipedia.org/wiki/Economic_bubble



No, the whole point is to find a list of things that were called bubbles at the time, whether or not they actually turned out to be bubbles.

Tips are appreciated (very tiny tips are perfectly okay!) 13gDRynPfLH3NNAz3nVyU3k3mYVcfeiQuF
unk
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June 07, 2011, 02:55:23 AM
 #10

more fundamentally, whenever there's just one exchange (or a group of colluding ones), there's always the possibility that the exchange itself is a ponzi scheme. i'm not accusing the operators of mt. gox of that, of course, but there's little way anyone would know if that's what they wanted to do.

i'm half tempted to make a large sale and transfer just to satisfy my inner empiricist and prove to myself that it would be possible to withdraw a large sum of dollars. (i don't believe i can recall anyone in the forum claiming to have pulled out $100,000 having deposited only bitcoins.) if you imagine the whole bitcoin economy from the perspective of a cautious outsider, rather than one of us who feels he has some sense of the history and personalities involved, a fear that the whole thing is an illusion would be quite a legitimate one.

as to the question about bubbles, i don't have statistical evidence to back it up, but overall very few things have been called 'bubbles', and most have turned out to be bubbles. it's hard, indeed, to think of counterexamples. (there are relatively few examples of stable, rapid, exponential price growth overall in the first place, and not all of them are called bubbles. people didn't say microsoft was a bubble at the time, for example. in fairness, surely some did, but that wasn't the tenor of the news or the public discussion.)
unk
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June 07, 2011, 02:57:29 AM
 #11

(by the way, where's kiba's cartoon? am i admitting either my denseness or lack of touch with what today's internet culture considers funny if i say that i never really understood it? i always felt like it was perhaps missing the final frame.)
gongcheng
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June 07, 2011, 02:59:35 AM
 #12

Someone should research everything that's been called a bubble when it started and figure out how many of those things actually turned out to be bubbles. I'd kick in a few bitcents if someone put a bounty on this.

you can send me a few bitcents by this address:
167WiVPxF6FP6WBfPShRQzj9QrvFNJ8AZX

because here is quit a few examples about economic bubbles:
http://en.wikipedia.org/wiki/Economic_bubble



No, the whole point is to find a list of things that were called bubbles at the time, whether or not they actually turned out to be bubbles.

I believe that all the bubbles listed in the list were called a bubble by some wise guy during their time. For example, Peter Schiff has predicted that the price of American real estate is a bubble and when it collapse it will lead to world wide economic crisis.

In fact it is not difficult at all to find a bubble. However, it is difficult to convince others that it is a bubble because people have invested money into the bubble and unwilling to believe it is a bubble.

DATA COMMANDER
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June 07, 2011, 03:01:19 AM
 #13

Someone should research everything that's been called a bubble when it started and figure out how many of those things actually turned out to be bubbles. I'd kick in a few bitcents if someone put a bounty on this.

you can send me a few bitcents by this address:
167WiVPxF6FP6WBfPShRQzj9QrvFNJ8AZX

because here is quit a few examples about economic bubbles:
http://en.wikipedia.org/wiki/Economic_bubble



No, the whole point is to find a list of things that were called bubbles at the time, whether or not they actually turned out to be bubbles.

I believe that all the bubbles listed in the list were called a bubble by some wise guy during their time. For example, Peter Schiff has predicted that the price of American real estate is a bubble and when it collapse it will lead to world wide economic crisis.

In fact it is not difficult at all to find a bubble. However, it is difficult to convince others that it is a bubble because people have invested money into the bubble and unwilling to believe it is a bubble.

*shakes head*

Not going to explain it again.

Tips are appreciated (very tiny tips are perfectly okay!) 13gDRynPfLH3NNAz3nVyU3k3mYVcfeiQuF
acamus
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June 07, 2011, 03:02:45 AM
 #14

(by the way, where's kiba's cartoon? am i admitting either my denseness or lack of touch with what today's internet culture considers funny if i say that i never got really understood it? i always felt like it was perhaps missing the final frame.)

I'll just leave this here http://bitcoinweekly.com/articles/comic-reaction-after-dramatic-rise-of-bitcoin-s-value

Short Bitcoin  (http://forum.bitcoin.org/index.php?topic=12536.0) if you dare.
http://www.tradebitcoin.com/
http://oneminuteslow.com/bitcoin/100-20.png (http://forum.bitcoin.org/index.php?topic=8895.0)
15V8JNvmvuWnRF3r6hfTyLL1ukyfp
DATA COMMANDER
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June 07, 2011, 03:08:28 AM
 #15

(by the way, where's kiba's cartoon? am i admitting either my denseness or lack of touch with what today's internet culture considers funny if i say that i never got really understood it? i always felt like it was perhaps missing the final frame.)

It's...not funny. But in a strange way, it's becoming funny, just because he keeps posting it and it so obviously lacks a punchline. Meta-humor?

Tips are appreciated (very tiny tips are perfectly okay!) 13gDRynPfLH3NNAz3nVyU3k3mYVcfeiQuF
gongcheng
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June 07, 2011, 03:13:13 AM
 #16

In fact it doesn't matter to me, because I invested only a little money on Bitcoin. Even it is a bubble, I won't lose a lot of money.

I just want to warn those who want to invest a lot of money onto Bitcoin.

billyjoeallen
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June 07, 2011, 03:14:51 AM
 #17

Dollars A.K.A. FRNs are in a bubble. I checked the price of gold on Bloomberg and then I did a Google trends search on QE3 (next round of money printing A.K.A. intentional currency debasement) and it looks like the equity markets are already pricing in another round of Federal Reserve legal counterfeiting.  The other nations of the world will follow suit in the next round of the endless race to devalue their own currency more. It's a race to the bottom.

Then the fun really begins. Capital controls. The only way to move your money across international boundaries will be Bitcoin or stuffing cash in your shoes.

insert coin here:
1Ctd7Na8qE7btyueEshAJF5C7ZqFWH11Wc

Open an exchange account at CampBX: options, lowest commissions, and best security
https://campbx.com/register.php?r=0Y7YxohTV0B
stic.man
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June 07, 2011, 03:15:47 AM
 #18

In fact it doesn't matter to me, because I invested only a little money on Bitcoin. Even it is a bubble, I won't lose a lot of money.

I just want to warn those who want to invest a lot of money onto Bitcoin.


yeah, warn people that could help your investment and this system grow, real intelligent
gongcheng
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June 07, 2011, 03:45:59 AM
 #19

In fact it doesn't matter to me, because I invested only a little money on Bitcoin. Even it is a bubble, I won't lose a lot of money.

I just want to warn those who want to invest a lot of money onto Bitcoin.


yeah, warn people that could help your investment and this system grow, real intelligent

I just want warn that there is a risk of bubble. So don't invest too much money. Otherwise you will lose a lot of money when the bubble collapse.

gongcheng
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June 07, 2011, 11:09:02 AM
 #20

Nobody agree with me?

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