Bitcoin fair price in 2013 - A more realistic poll

[deathcode]

This is an unbiased poll with 5 options. Two bullish, Two bearish, and the status quo.

[caveden]

Price is always "fair" if coercion is not being used to set it.

So, yeah, the current price is fair, and wherever it goes, it will remain fair.

[deathcode]

Price is always "fair" if coercion is not being used to set it.

So, yeah, the current price is fair, and wherever it goes, it will remain fair.

Is this an opinion or a fact?

[piramida]

this is neither, it's a definition of a fair price.

[turboNOMAD]

Voted "~20 makes more sense"
Not that I think $40 is too high, but simply because quadrupling price in just 2 months cannot be a normal rally, so a correction must follow.

[BitPirate]

I think just over ~$50 by now would be a fair price, so I voted $47.

I don't see there being any big movement now until Monday, where we still might hit $50.

If the current price were unfairly manipulated, it would have crashed for good with the bad news earlier this week -- people looking to get out would have done, for good. It didn't. It's a fair price.

[deathcode]

this is neither, it's a definition of a fair price.

In accounting and economics, fair value is a rational and unbiased estimate of the potential market price of a good, service, or asset

It seems like the definition of fair price/value uses the word potential. I don't see how your definition is comparable to this definition of fair price. potential means the future. How far in the future is not established but can be. the price is always fair in present time, however since this pools is posted in the speculation section, then we must see it as the future value of bitcoin and not its current.

[desired_username]

There's no such thing as fair price regarding to Bitcoin, so I cannot understand people giving any value.

Think of it from an other perspective:

The price of bitcoin just indicates how big the BTC economy is.

It is insignificantly small at the moment.

[granolageek]

Price is always "fair" if coercion is not being used to set it.

So, yeah, the current price is fair, and wherever it goes, it will remain fair.

That's theology, not experience.

The one Keynes quote that even the Austrians use is "The market can remain irrational longer than you can remain solvent."

[afbitcoins]

My view is that the bitcoin market is one of the only markets in the world where a fair price is achieved by honest price discovery between buyers and sellers. The market is on a bull run which extends back before the bubble in 2011 and I see no reason for that to end. It is increasing on a log basis. It won't be long before people happily pay more than $100 for a bitcoin.

I'm hoping for a breakout past the $50 mark and think there is a great chance we'll achieve it. We're not in a bubble yet.

[granolageek]

I'm hoping for a breakout past the $50 mark and think there is a great chance we'll achieve it. We're not in a bubble yet.

The run from $32 to $49 was pretty bubbleicuous. A few weeks in the forties to stabilize things will build some confidence.

[Wekkel]

... simply because quadrupling price in just 2 months cannot be a normal rally, so a correction must follow.

Trader error no ##: just because the price went up so drastically, it must come down.

[deathcode]

... simply because quadrupling price in just 2 months cannot be a normal rally, so a correction must follow.

Trader error no ##: just because the price went up so drastically, it must come down.

Actually is an educated statement. I see that EVERY day in the stock market!
Stocks jumping %10-15 after a quarterly report and them coming down the next day almost back to what they were before or settling 2-3% over the original price.
I see cases where in the vicinity of a conference call to announce quarter results, the stock goes up, and even though the companies beat expectation, the stock suddenly comes down anyway.
His statement is not far from reality, however, bitcoin is its own niche and it has some disctintive qualities that make him unique.

[cdb000]

I don't have the faintest idea what is a "fair" price for a Bitcoin.

I mine Bitcoins using GPUs, long ago paid for. It costs me about £11 in power to mine a Bitcoin. Would (say) £15 be a "fair" price? Maybe, but I'm happier with a price above £30.

If you offer me £32 for my Bitcoins and I accept your offer, than maybe that is a fair price.

If you offer me £32 for my Bitcoins and I decide instead to hold them, does that mean that £32 is not a fair price?

Does anybody actually have an objective definition of the word fair anyway? Many people use the word "fair" to mean "what I think it should be".

[notbrain]

... simply because quadrupling price in just 2 months cannot be a normal rally, so a correction must follow.

Trader error no ##: just because the price went up so drastically, it must come down.

Actually is an educated statement. I see that EVERY day in the stock market!
Stocks jumping %10-15 after a quarterly report and them coming down the next day almost back to what they were before or settling 2-3% over the original price.
I see cases where in the vicinity of a conference call to announce quarter results, the stock goes up, and even though the companies beat expectation, the stock suddenly comes down anyway.
His statement is not far from reality, however, bitcoin is its own niche and it has some disctintive qualities that make him unique.

"Past performance is no guarantee of future results."

This is not the fiat-based market you are looking for...    http://www.youtube.com/watch?v=2I33k8vV3Sk

Bitcoin is an infant, $100 by end of year is reasonable as long as gov coercion stays away. Think in terms of market cap and how many companies are worth more than all BTC in circulation. $100 per btc would give a little over $1B in mkt cap...still sitting at the kiddie table in global capital markets.

Human behavior is way more complex than the current market models and net risk models dictate.

[randrace]

The one Keynes quote that even the Austrians use is "The market can remain irrational longer than you can remain solvent."

Oh, hell yeah! I'm posting here on my way to the John Maynard Keynes Quotes Thread!

Long run is a misleading guide to current affairs. In the long run we are all dead.

[Wekkel]

Also used by Austrians is the famous quote from Keynes' book 'the economic consequences of the peace'

Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens ... Lenin was certainly right. There is no subtler, no surer means of over-turning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.

I still shake my head when I read this quote and am subsequently reminded of this dark force raging in our societies.

[Zangelbert Bingledack]

Fair price is a myth.

[rpietila]

By using net present value analysis, I came up with the result that a bitcoin now is actually worth $2000 on average. There is significant variation in the possible outcomes, though. Considering that many people will want to get rich even when the odds are against them, I see that bitcoin is a good value proposition to become rich. After all, the average payout is 40 times the the investment now (it was even discounted at 8%).

For a person with my tolerance for risk, this translates to a portfolio allocation of about 40%, and I am busy trying to achieve it.

In the links below, in my signature, you can support my quest by purchasing silver for cheap or for cheaper (hint: post #50).

[Wekkel]

By using net present value analysis, I came up with the result that a bitcoin now is actually worth $2000 on average.

Very interesting.

Would you be so kind to share a bit more of the reasoning/calculation behind this outcome? Furthermore, I assume that you see $2,000 as the projected end value (and not the current value,as the text suggests)?