[2013-12-04] -Bloomberg - Greenspan says bitcoin a Bubble

[NewLiberty]

http://www.bloomberg.com/news/2013-12-04/greenspan-says-bitcoin-a-bubble-without-intrinsic-currency-value.html

Former Federal Reserve Chairman Alan Greenspan said Bitcoin prices are unsustainably high after surging 89-fold in a year and that the virtual money isn’t currency.
“It’s a bubble,” Greenspan, 87, said today in a Bloomberg Television interview from Washington. “It has to have intrinsic value. You have to really stretch your imagination to infer what the intrinsic value of Bitcoin is. I haven’t been able to do it. Maybe somebody else can.”

The man who was the most wrong about everything in economics with the possible exception of every other Fed chief says Bitcoin is a bubble and has no intrinsic value.
We must be on to something here.

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[Carlton Banks]

Greenspan is said to have commented: "there is no fundamental means of 'repaying' it by any means that is universally accepted."

That's right Alan, it's not a token representing the part of the national debt that's made up of Treasury Bonds, i.e. it's an asset-based currency, not a claim on a gigantic and never-to-be paid debt based currency.

How in hell does this guy actually get away with sitting there on National TV, complaining that he doesn't understand the value of something that's not part of the scammy system he presided over for 20 years? Are people listening to the words coming out of this guys mouth at all? Do they actually understand that he's complaining that it's not bullshit nationalised servitude, and that the Federal Reserve shareholders (e.g. Goldman Sachs, Carnegie Mellon, JP Morgan et al) cannot possibly roll around with their legs in the air while sucking everyone dry?

No wonder the Chinese state have shut the Dollar window. Buy Bitcoin, and stand back to a safe distance. Expect some turbulence.

[exstasie]

I'm too lazy to read the article, but does it state what his position is on Bitcoins in general?

[oakpacific]

It feels strange to hear all those "Bitcoin has no intrinsic value", "Bitcoin has no real use" blabbers coming from all these bigwigs while I am enjoying the unprecedented convenience in online business provided by Bitcoin.

I guess the same applies to those who have to suffer geocentrists.

[Vexatious]

Greenspan is said to have commented: "there is no fundamental means of 'repaying' it by any means that is universally accepted."

That's right Alan, it's not a token representing the part of the national debt that's made up of Treasury Bonds, i.e. it's an asset-based currency, not a claim on a gigantic and never-to-be paid debt based currency.

How in hell does this guy actually get away with sitting there on National TV, complaining that he doesn't understand the value of something that's not part of the scammy system he presided over for 20 years? Are people listening to the words coming out of this guys mouth at all? Do they actually understand that he's complaining that it's not bullshit nationalised servitude, and that the Federal Reserve shareholders (e.g. Goldman Sachs, Carnegie Mellon, JP Morgan et al) cannot possibly roll around with their legs in the air while sucking everyone dry?

No wonder the Chinese state have shut the Dollar window. Buy Bitcoin, and stand back to a safe distance. Expect some turbulence.

That's a phenomenal rant right there! It's my birthday today and this was my favourite gift. I couldn't agree with you more.

[goxed]

http://www.bloomberg.com/news/2013-12-04/greenspan-says-bitcoin-a-bubble-without-intrinsic-currency-value.html

Former Federal Reserve Chairman Alan Greenspan said Bitcoin prices are unsustainably high after surging 89-fold in a year and that the virtual money isn’t currency.
“It’s a bubble,” Greenspan, 87, said today in a Bloomberg Television interview from Washington. “It has to have intrinsic value. You have to really stretch your imagination to infer what the intrinsic value of Bitcoin is. I haven’t been able to do it. Maybe somebody else can.”

The man who was the most wrong about everything in economics with the possible exception of every other Fed chief says Bitcoin is a bubble and has no intrinsic value.
We must be on to something here.

and housing bubble was an impossible event up until 2007

[pand70]

During the last month there was a lot of positive coverage with all those success stories and such. Lately things are turning around with many negative articles being published. I 'm afraid that some people that entered during the latest boom will start having second thoughts.

[NewLiberty]

Its backed by the full faith and credit of mathematics.
As well as everything anyone holds with a bitcoin valuation for which they will happily trade away for bitcoin.
Which is to say that it isn't backed by anything in particular.

However I for one, am backing it with silver and gold from the Bitcoin specie project.  Bitcoin Specie:



As to whether bitcoin has any intrinsic value...maybe it does, maybe not.  The Dollar certainly doesn't.  That is a debt instrument.  It is a promissory "note" as in Federal reserve Note.  So it has to worry about being repaid, bitcoin doesn't have that worry.  We aren't concerned about being repaid, our bitcoins seem perfectly redeemable just as they are.  For a Lamborghini just today, yes?
https://bitcointalk.org/index.php?topic=357820.0
http://lamborghininewportbeach.blogspot.com/2013/12/we-just-sold-our-very-first-vehicle.html

Although they don't really understand what "Legal Tender" means, if they did, they wouldn't use it in that context.  "Legal Tender" means you are forced to accept it, not that you are allowed to accept it.  It is not a good thing, and we don't want Bitcoin to be legal tender, free choice is better, and you really only need a legal tender law when your currency sucks.

[TiagoTiago]

[NewLiberty]

Bloomberg keeps replaying the small part of the Greenspan interview where he says "Is bitcoin in a bubble? Yes!" and not much else of the interview (he talked about a lot of things)

Interesting that Bloomberg is talking it down....  Maybe they want to buy?

[laowai80]

“It’s a bubble,” Greenspan, 87, said today

I smell a troll here

[marcus_of_augustus]

Bullish. Best contrary indicator ever, on past performance.

[Lethn]

It feels strange to hear all those "Bitcoin has no intrinsic value", "Bitcoin has no real use" blabbers coming from all these bigwigs while I am enjoying the unprecedented convenience in online business provided by Bitcoin.

I guess the same applies to those who have to suffer geocentrists.

Then there's the fact you can trade with everybody in the world without being restricted or blockaded by governments, you also can't be taxed and nobody can take any money out of your account unless you type in your password and give it voluntarily. Oh yeah and you can't get spied on easily and people won't be able to data farm your spending habits to send junk to you or find out your home address.

Interesting that Bloomberg is talking it down....  Maybe they want to buy?

I suspect all these people are scared that their respective selling points ( Dollar/Gold ) are going to drop in value.

[thezerg]

Absolutely...you should keep your money in USD.  Never mind the fact that they've printed $14000 for every household in America during QE.  Move right along please. 

[TraderTimm]

Bullish. Best contrary indicator ever, on past performance.

Yep, if Greenspan, the doddering old fool who couldn't understand his policies were creating the largest housing bubble of all time, says that Bitcoin is in a bubble - well, buddy - you're not seeing things so well, are you.

He's in the same league as Cramer when he said Bear Stearns was "FINE" one day before they filed for bankruptcy.

They're both bought and paid for by the financial system that they work within.

[pand70]

Absolutely...you should keep your money in USD.  Never mind the fact that they've printed $14000 for every household in America during QE.  Move right along please. 

So if a national currency is healthy we should not move to bitcoin? I mean stop hating dollars to prove the worth of bitcoin. It's just wrong and pointless.

[BitCoiner2012]

This is RICH coming from Greenspan, architect of such a financial mess..

[LiteCoinGuy]

he doesnt seem to be confident in this video about his own opinion.

[BalkanBoy]

http://www.bloomberg.com/news/2013-12-04/greenspan-says-bitcoin-a-bubble-without-intrinsic-currency-value.html

Former Federal Reserve Chairman Alan Greenspan said Bitcoin prices are unsustainably high after surging 89-fold in a year and that the virtual money isn’t currency.
“It’s a bubble,” Greenspan, 87, said today in a Bloomberg Television interview from Washington. “It has to have intrinsic value. You have to really stretch your imagination to infer what the intrinsic value of Bitcoin is. I haven’t been able to do it. Maybe somebody else can.”

The man who was the most wrong about everything in economics with the possible exception of every other Fed chief says Bitcoin is a bubble and has no intrinsic value.
We must be on to something here.

So if Greenspan is wrong about everything else, that automatically disqualifies him as giving a valid opinion on BitCoin? What if he is right, have you considered that, or does that not fit in with your worldview?

[TraderTimm]

So if Greenspan is wrong about everything else, that automatically disqualifies him as giving a valid opinion on BitCoin? What if he is right, have you considered that, or does that not fit in with your worldview?

Okay, lets say the father of the largest real-estate bubble in america is somehow *right* about bitcoin. Well, when would you expect this to manifest itself? After the first surge to a dollar? The second to 31? The third to 266? The fourth to 1,000+? Do you see a pattern here at all?

When confidence is lost, the opportunity to recover is also lost. Bitcoin hasn't lost that confidence. For that to happen, we would freefall to near zero, and then stay at some mediocre value - say 1 dollar, and taper off to nothingness as everyone just decided to stop participating.

The problem with his grand and sweeping pronouncement is he bases this on the "intrinsic value" theorem, which for old economic fossils, usually means Gold. You can't directly compare bitcoin and gold, although some try. I suppose there is a rudimentary basis for doing so, where the scarcity of gold ore could be held up to the relative scarcity of finding the correct "hash" for a block. But other than that, they are distant cousins to each other.

In any case, I'd just take his predictions he made during his career and apply that probability ratio to what he's said about Bitcoin. If anything, its a contrary indicator.