Bubble? Growth? One goat's thoughts

[Peter Lambert]

Absolute minimum floor right now is $50. Even self-confessed bears will be buying at $50 or above. Remember that BTC is a currency, not a stock.

I think most would be happy to just hold on to $50 too. Those who don't -- no big loss.

I would say the absolute floor is more like 12 USD.

according to history it stops where it started

The 2011 bubble started at 1 usd stopped at 2x or 5x where it started, depending on if you end it at 2 usd or call that the bear trap and the actual end was when it leveled off at 5 usd. I would say it looks like this bubble started at about 12 usd, is the price going to go back to that level, or will it again level off at a point higher than it started, like 24 usd or 50 usd?

[evolve]

Absolute minimum floor right now is $50. Even self-confessed bears will be buying at $50 or above.

Nah, I think we could still see single digits easily.

[notme]

http://www.youtube.com/watch?v=PpccpglnNf0&t=24

[sgbett]

fwiw I think op makes a lot of sense. The patterns so far have all taken place in a nerd microcosm. The nerds have had their hype cycle, and in the grand scheme of things i think the first bubble will barely register as a blip inthe awareness phase

Makes perfect sense to me that this is media attention, and when the world gets hold of this today's vertical rise will become tomorrow's foothill of the bubble that we are about to enter.

my optimism is of course based in the fact I am holding a big (for me) chunk of coins

[jubalix]

I really don't think this picture applies to something like Bitcoin. I'm not going to elaborate further. I'll be happy to eat crow if I'm wrong.

>>I'm not going to elaborate further<< i hear you!!

this BTC is revalue in the world, and reorganizing it, think of it as growing into a percentage of world trade that state FIAT/Fractional reserve banking etc, AND store of wealth...currently occupies.

its people who are stuck in the mindset, its a stock, its a bond its a derivative, they just cant get thier head around what FRB/FIAT/CRR are and how it works and why it has value or not.

Reminds me of Platos' shadows on a cave.

Think of it like this. Imagine you go from anaerobic to oxygen breathing bacteria, the latter is a new paradigm and makes 38 ATP rather than 2 ATP.

Its a paradigm change.

[ElectricMucus]

Its a paradigm change.

I ain't seeing the irony in that.
"New Paradigm" !!!  


Further food for your thought.

[Piper67]

Its a paradigm change.

I ain't seeing the irony in that.
"New Paradigm" !!!  


Further food for your thought.

The problem with that article is that it also applies to a whole bunch of bubbles that turned out not to be bubbles at all... like the advent of television, population growth, energy consumption and so on. Sometimes, a good idea is just a really, really good idea. 

[ElectricMucus]

Its a paradigm change.

I ain't seeing the irony in that.
"New Paradigm" !!!  


Further food for your thought.

The problem with that article is that it also applies to a whole bunch of bubbles that turned out not to be bubbles at all... like the advent of television, population growth, energy consumption and so on. Sometimes, a good idea is just a really, really good idea.  

#4
This time its different!  

To further elaborate this: Bitcoin is not a technology. It's a proof of concept of one and a such a implementation. Nobody uses lightbulbs made by Edison himself.
Second the bubble concerns using bitcoins as a speculative investment not the software.

[Vladimir]

Actually it is. Yes all  this bubble talk is well known. But I do accept that Bitcoin is revolutionary new form of money. It is a singularity and it is a new paradigm indeed. Just like fire, wheel, printing press and the internet. These new paradigms and new singularities do happen from time to time.

Those who refuse to accept this... well whatever, you chose to "join the party fashionably late", not my problem.

[ElectricMucus]

Actually it is. Yes all  this bubble talk is well known. But I do accept that Bitcoin is revolutionary new form of money. It is a singularity ...

Bullshit. reminds me of this btw.

(stopped reading right there.)

[Vladimir]

You have no vision. That's elephant shit then.

[Piper67]

Actually it is. Yes all  this bubble talk is well known. But I do accept that Bitcoin is revolutionary new form of money. It is a singularity ...

Bullshit.

(stopped reading right there.)

Well, then this is what the whole argument boils down to, isn't it? Either Bitcoin is a truly revolutionary idea, which will radically change the way in which we humans transact and assign value, or it isn't.

If you think it isn't, then it stands to reason you should assume it's a fad, like tulips, or cheap mortgages, or SOME (not all) of the companies that chose to build stuff around this new internet concept back in the late 1990's.

If you think it is, then it stands to reason you should assume it will continue to grow. Certainly with some ups and downs, mostly driven by greed and market forces, but essentially moving in one direction. Kind of like the internet itself.  

The argument is simple... some of the variables are known, some are not. From the ones that are, and an educated guess as to which ones aren't, I've made a decision as to which side of the argument I take.

Let's revisit it in 2040, shall we?

[Qoheleth]

Well, then this is what the whole argument boils down to, isn't it? Either Bitcoin is a truly revolutionary idea, which will radically change the way in which we humans transact and assign value, or it isn't.

If you think it isn't, then it stands to reason you should assume it's a fad, like tulips, or cheap mortgages, or SOME (not all) of the companies that chose to build stuff around this new internet concept back in the late 1990's.

If you think it is, then it stands to reason you should assume it will continue to grow. Certainly with some ups and downs, mostly driven by greed and market forces, but essentially moving in one direction. Kind of like the internet itself.  

I think that's a bit of a false dichotomy!

I see the blockchain as a revolutionary technology, which will radically change our financial systems.

Even so. Even so. Humans in markets tend to act a particular way, which causes the kinds of patterns we see over and over. Remember, there have been gold bubbles. There was a dot-com bubble, even though the Internet really has changed how we live. The reason? You have something people can get excited about, they get too enthusiastic too fast, the price balloons way past what's sustainable, new buyers run out and people start taking profits, it all comes crashing down, and eventually you return to the old trendline, wiser about what the market can support.

None of this has anything to do with the inherent value of the underlying asset. The asset can be the best thing since sliced bread - all that's necessary to create a bubble is that people who don't fully understand the asset get excited about it and buy in, and then panic when growth stalls.

[hgmichna]

The 2011 bubble started at 1 usd stopped at 2x or 5x where it started, depending on if you end it at 2 usd or call that the bear trap and the actual end was when it leveled off at 5 usd. I would say it looks like this bubble started at about 12 usd, is the price going to go back to that level, or will it again level off at a point higher than it started, like 24 usd or 50 usd?

Has it occurred to anyone that the current, second bubble already started before the first, 2011 bubble truly ended? These may not be two independent bubbles, they may be just one that begun with a little foreplay in 2011.

To those who think that bitcoin ought to rise in value very quickly because it is a revolutionary new paradigm, ask yourself the question why people are buying bitcoin right now. Are they buying because they understand the greatness of the concept? Are they buying because they are Cypriots or Spaniards, trying to escape their banks? Or are they simply buying because the price is going up?

[Vladimir]

All parties in this argument could be actually correct simultaneously. Very much depends on "which chart  you r trading".

If you are trading 1 minute chart, then hell yes shout bubble right now and you will be right. Some of us are "trading" weekly and monthly and even yearly chart. What for some is a bubble or two for others is just white noise.

[Piper67]

The 2011 bubble started at 1 usd stopped at 2x or 5x where it started, depending on if you end it at 2 usd or call that the bear trap and the actual end was when it leveled off at 5 usd. I would say it looks like this bubble started at about 12 usd, is the price going to go back to that level, or will it again level off at a point higher than it started, like 24 usd or 50 usd?

Has it occurred to anyone that the current, second bubble already started before the first, 2011 bubble truly ended? These may not be two independent bubbles, they may be just one that begun with a little foreplay in 2011.

To those who think that bitcoin ought to rise in value very quickly because it is a revolutionary new paradigm, ask yourself the question why people are buying bitcoin right now. Are they buying because they understand the greatness of the concept? Are they buying because they are Cypriots or Spaniards, trying to escape their banks? Or are they simply buying because the price is going up?

That's a bit like asking those who got their first email accounts in 1992 did it because they understood the revolutionary nature of the internet, because they needed to communicate with friends and family or because everyone else was doing it. The answer is, quite likely, a bit of all three... but it doesn't really matter.

[nwbitcoin]

I love that OP graph, very cool, however, its hard working out where we are on it because its a retrospective graph.

The dot com boom took a good 7 years to pop.  While we are able to get out data quicker these days, we are also able to grow an idea far further than ever before, so that bubble can get massive.  

I have a feeling we are still at the lower levels of the slope at the moment, and there is easily a potential for bitcoins to go to 1000s before common sense kicks in.  Think of it as the domain name craze where business.com and sex.com went for silly money, but neither today are gateways to the biggest and best of what they describe.

BTW, the term bubble has a real meaning, rather than just huge growth in a little time.  A real bubble is when your mum borrows money to buy bitcoins.  When that happens, then its a bubble, and I dont see that happening for a few years.

[Qoheleth]

BTW, the term bubble has a real meaning, rather than just huge growth in a little time.  A real bubble is when your mum borrows money to buy bitcoins.  When that happens, then its a bubble, and I dont see that happening for a few years.

Ah, the meat of the discussion.

The reason I think we're farther right now is because of the sort of media attention Bitcoin has been getting. It's being covered on mainstream news, and the growth factors (3-4x in the last two months) are being mentioned. That's the kind of data that gets people without specialist knowledge over-excited and over-investing (i.e. Aunt Flo borrowing money to buy in).

I agree that it'll probably take a while, though.

[ElectricMucus]

BTW, the term bubble has a real meaning, rather than just huge growth in a little time.  A real bubble is when your mumsuckers borrows money to buy bitcoins.  When that happens, then its a bubble, and I dont see that happening for a few years. months now.

FTFY

[nwbitcoin]

BTW, the term bubble has a real meaning, rather than just huge growth in a little time.  A real bubble is when your mumsuckers borrows money to buy bitcoins.  When that happens, then its a bubble, and I dont see that happening for a few years. months now.

FTFY

Really?

That is frightening - I still use the old fashioned idea that I only invest cash I can afford to lose!