rpietila Wall Observer - the Quality TA Thread ;)

[coinits]

ETFs are evil and a tool of the Corpo-fascists to destroy the true value of commodities. Case in point. Look at what they have done to precious metals.

That's a knock against precious metals themselves - they are not good enough to stand up against ETFs because no one has any use for them. The hassle of delivery and storage combined with the lack of any practical use of the metal itself to its owner (can't spend it as money directly anywhere, aren't going to make a spoon out of it). If this wasn't true then more people would be holding precous metals themselves instead of buying ETF shares in them.

WTF? Are you serious? You have no idea how the financial system works. No practical use? BUWHAHAHAHAHAHAH. Gee I wonder what is in your cell phone?

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[wpalczynski]

ETFs are evil and a tool of the Corpo-fascists to destroy the true value of commodities. Case in point. Look at what they have done to precious metals.

That's a knock against precious metals themselves - they are not good enough to stand up against ETFs because no one has any use for them. The hassle of delivery and storage combined with the lack of any practical use of the metal itself to its owner (can't spend it as money directly anywhere, aren't going to make a spoon out of it). If this wasn't true then more people would be holding precous metals themselves instead of buying ETF shares in them.

WTF? Are you serious? You have no idea how the financial system works. No practical use? BUWHAHAHAHAHAHAH. Gee I wonder what is in your cell phone?

What are the practical uses for your average investor as far as PMs are concerned? (certainly not commercial manufacturing)

[Syke]

All the permabulls such as rpietila will have to capitulate and sell some at these lows before we will have bottomed.

Seems backwards. I'm buying at these lows, and won't be selling until we go way back up from here.

[coinits]

ETFs are evil and a tool of the Corpo-fascists to destroy the true value of commodities. Case in point. Look at what they have done to precious metals.

That's a knock against precious metals themselves - they are not good enough to stand up against ETFs because no one has any use for them. The hassle of delivery and storage combined with the lack of any practical use of the metal itself to its owner (can't spend it as money directly anywhere, aren't going to make a spoon out of it). If this wasn't true then more people would be holding precous metals themselves instead of buying ETF shares in them.

WTF? Are you serious? You have no idea how the financial system works. No practical use? BUWHAHAHAHAHAHAH. Gee I wonder what is in your cell phone?

What are the practical uses for your average investor as far as PMs are concerned? (certainly not commercial manufacturing)

Wrong!

Almost all electronics on the planet has PM in it. Without them you could not be on the Internet right now.

[wpalczynski]

ETFs are evil and a tool of the Corpo-fascists to destroy the true value of commodities. Case in point. Look at what they have done to precious metals.

That's a knock against precious metals themselves - they are not good enough to stand up against ETFs because no one has any use for them. The hassle of delivery and storage combined with the lack of any practical use of the metal itself to its owner (can't spend it as money directly anywhere, aren't going to make a spoon out of it). If this wasn't true then more people would be holding precous metals themselves instead of buying ETF shares in them.

WTF? Are you serious? You have no idea how the financial system works. No practical use? BUWHAHAHAHAHAHAH. Gee I wonder what is in your cell phone?

What are the practical uses for your average investor as far as PMs are concerned? (certainly not commercial manufacturing)

Wrong!

Almost all electronics on the planet has PM in it. Without them you could not be on the Internet right now.

I don't think you understand the point I am trying to make.


I ask again, what are the practical uses for your average investor as far as PMs are concerned?  Once they have their silver at home, what can they do with it?


What you have been describing are industrial uses for precious metals.

[coinits]

ETFs are evil and a tool of the Corpo-fascists to destroy the true value of commodities. Case in point. Look at what they have done to precious metals.

That's a knock against precious metals themselves - they are not good enough to stand up against ETFs because no one has any use for them. The hassle of delivery and storage combined with the lack of any practical use of the metal itself to its owner (can't spend it as money directly anywhere, aren't going to make a spoon out of it). If this wasn't true then more people would be holding precous metals themselves instead of buying ETF shares in them.

WTF? Are you serious? You have no idea how the financial system works. No practical use? BUWHAHAHAHAHAHAH. Gee I wonder what is in your cell phone?

What are the practical uses for your average investor as far as PMs are concerned? (certainly not commercial manufacturing)

Wrong!

Almost all electronics on the planet has PM in it. Without them you could not be on the Internet right now.

I don't think you understand the point I am trying to make.


I ask again, what are the practical uses for your average investor as far as PMs are concerned?  Once they have their silver at home, what can they do with it?

Hold. A true store of wealth. Has about a 10,000 year track record. It is rather easy to comprehend. It never loses value.

I suppose that I can cash in for fiat at any time but I won't because the very reason to hold is that the financial terrorists will implode their paper empire leaving everyone holding worthless paper while they run off with their stashes of PMs accumulated selling worthless paper to suckers.

I live by a simple math:

Security = Bullets + Bread + Bullion

Crypto is new to the mix and worth dumping fiat into so I may change the equation somewhat.

[iamback]

Why should anyone take your predictions seriously?

Math:

https://bitcointalk.org/index.php?topic=355212.msg10650637#msg10650637

[coinits]

Why should anyone take your predictions seriously?

Math:

https://bitcointalk.org/index.php?topic=355212.msg10650637#msg10650637

Thank you for this. very interesting. Looks like it will distract me from here

[isov]

Anyone who has been closely observing markets care to make a short post about where are we standing at the moment? Haven't been observing too much for the past couple months. Seems quite boring with a quick peek at the markets but weekly macd is drawing small green candles again and markets seem cautiously positive? Are you guys still believing there is a chance of rallying again at some point in the summer maybe?

[molecular]

ETFs are evil and a tool of the Corpo-fascists to destroy the true value of commodities. Case in point. Look at what they have done to precious metals. They trade paper representations of the same ounce of gold over and over again causing hundreds, if not thousands of people to own the same ounce. They use Kabuki Theater and rehypothecate precious metals to perpetrate the scam. Eventually it will fail and people who thought that they could get actual metal for their paper will be paid in fiat that will be worthless.  No one reads the fine print in the SLV nor GLD ETFs. They tell you as much. You get fiat at their discretion. You do not own a damn thing except shit paper.

When this comes to BTC you will be fed bullshit encouraging you to invest in these ETFs. Short-term, yes there will be an euphoric windfall compared to fiat, but if you dance with the devil you will end up losing your BTC and selling your soul.

Look at your BTC as physical PMs. It is not yours unless you have it in your possession.

That's a knock against precious metals themselves - they are not good enough to stand up against ETFs because no one has any use for them. The hassle of delivery and storage combined with the lack of any practical use of the metal itself to its owner (can't spend it as money directly anywhere, aren't going to make a spoon out of it). If this wasn't true then more people would be holding precous metals themselves instead of buying ETF shares in them.

Too bad the discussion veered off on a rather boring tangent in a very emotional way after the above 2 posts.

I think it's a very valid discussion and I'm thinking about this myself a lot: loads of people will buy the silbert or later maybe the winklevii shares and they will brag to their friends how they own bitcoin now. At first it will probably work out and they will participate in BTC appreciation through the shares they own.

coinits is right, though: you don't own bitcoins if you own such an ETF. Afaik there isn't even a way described to take delivery unless you are a primary dealer or whatever. It's easily imaginable that the trading volume of such vehicles might greatly exceed the volume on the 'real markets' and then we'll have a 'tail wags the dog' situation.

shields answer is promising at first sight: bitcoin isn't gold. It's easy to transact and store, so it's going to be easier for bitcoin to stand up to the ETFs.

I fear the answer is a bit weak, though: the primary use case of bitcoin currently is speculation. This use case is covered by he ETF just fine. I don't see ETF share owners taking delivery on their bitcoins (it's not encouraged or probably even possible, there might even be fine print saying they can be payed out in fiat). In addition: if they were planning to own bitcoins in the first place, why did they buy the shares and not coins, then.

To people who are saying: "but a share is always backed by 0.1 real Bitcoins in custody of the ETF handlers" we can only answer: that's a solution that requires trust in a centralized entity.

I fear these ETFs might turn out to be a slippery slope and might turn out to be misused to control bitcoin price. Hello naked shorting.

Yes: the utility of bitcoin can potentially stand up to such an attack, but only if bitcoin enjoys widespread actual use.

thoughts?

[Cconvert2G36]

Too bad the discussion veered off on a rather boring tangent in a very emotional way after the above 2 posts.

I think it's a very valid discussion and I'm thinking about this myself a lot: loads of people will buy the silbert or later maybe the winklevii shares and they will brag to their friends how they own bitcoin now. At first it will probably work out and they will participate in BTC appreciation through the shares they own.

coinits is right, though: you don't own bitcoins if you own such an ETF. Afaik there isn't even a way described to take delivery unless you are a primary dealer or whatever. It's easily imaginable that the trading volume of such vehicles might greatly exceed the volume on the 'real markets' and then we'll have a 'tail wags the dog' situation.

shields answer is promising at first sight: bitcoin isn't gold. It's easy to transact and store, so it's going to be easier for bitcoin to stand up to the ETFs.

I fear the answer is a bit weak, though: the primary use case of bitcoin currently is speculation. This use case is covered by he ETF just fine. I don't see ETF share owners taking delivery on their bitcoins (it's not encouraged or probably even possible, there might even be fine print saying they can be payed out in fiat). In addition: if they were planning to own bitcoins in the first place, why did they buy the shares and not coins, then.

To people who are saying: "but a share is always backed by 0.1 real Bitcoins in custody of the ETF handlers" we can only answer: that's a solution that requires trust in a centralized entity.

I fear these ETFs might turn out to be a slippery slope and might turn out to be misused to control bitcoin price. Hello naked shorting.

Yes: the utility of bitcoin can potentially stand up to such an attack, but only if bitcoin enjoys widespread actual use.

thoughts?

I think you covered the main attractions and pitfalls of the "3rd party fund vehicle"

It is important to understand that this was going to happen whether the "community" desires it, or not. The only matter of importance is its impact, positive, negative, or both.

On the positive side, it makes investment, or at least "exposure by proxy" available to whomever has a brokerage account and a keyboard. Without the technical responsibility of securing the keys. I would wager there is a lot of capital out there without great desire to deposit money with a sf startup or wire funds to hk, people who lack the confidence/knowledge to secure these digital bearer bonds after purchase. This is a potential opening of pent up and untapped demand. More liquidity in theory should diminish day to day volatility, which is something bitcoin needs to get more mainstream use.

Another half-positive, it could reduce the amount of on-chain transaction volume for speculation. Leaving more block space for non-speculative uses.

The two main negatives I see are the possibility of naked short selling with nefarious motives, and potential failure of funds themselves to adequately protect the assets and account for them correctly.

[smooth]

you don't own bitcoins if you own such an ETF

True, but if people prefer to own ETFs rather than own Bitcoins then that is a fault of Bitcoin, not of the users. The technology isn't meeting the needs of the target market.

[molecular]

you don't own bitcoins if you own such an ETF

True, but if people prefer to own ETFs rather than own Bitcoins then that is a fault of Bitcoin, not of the users. The technology isn't meeting the needs of the target market.

True. In Case we fail at Making bitcoin accessible enough there is danger of monetary inflation through the backdoor through these vehicles (ETF etc). One of the main selling points would be invalidated (capped supply)... In fact the main selling point for me.

[sgbett]

Why should anyone take your predictions seriously?

Math:

https://bitcointalk.org/index.php?topic=355212.msg10650637#msg10650637

 Any mention of Taleb automatically gets my attention.

The great thing is you have the computer already (Terminator: ...There is one more chip... *Terminator points to his head*)

Two issues with our computer is that we have is that we are clouded by emotion, and we don't have the huge dataset because people's memory is selective (in part due to that emotion - rose coloured spectacles phenomenon).

Then you have the fact that mostly people ask the wrong question: "What *will* happen?". People make the mistake of acting based on what they think *the* answer to that question is. As you said in your other post - its impossible to know the future. That path leads to ruin, imho. One might be right, but more likely one will be wrong.

The question one should ask is: "What *could" happen?" which I think is where your long tail comes in. If you assume you don't know the answer, but you consider all possible outcomes, and then position yourself on that basis. You make bank. Sure it might not be that you absolutely maximised, but better that a situation where you were just slightly wrong about the outcome but end up with nothing.

For example if we do get bitcoinmoon, my personal strategy leaves me with about 50-80% less BTC than I could have if I just HODL'd everything because I hedge against bitcoindoom. Whereas I see a lot of all in/all out posters that will just miss tops and bottoms, constantly bleed principal, fail to realise profits, get zhoutonged on margin calls etc etc all based on the mistaken premise that they can guess *right*.

Once you assume you are wrong, thats when you start making money. Thats just my style though. I'm sure all the l33t traders out there will smoke my meagre returns in the long run. (whilst the other 99% don't, hehe)

[iamback]

the primary use case of bitcoin currently is speculation

you don't own bitcoins if you own such an ETF

True, but if people prefer to own ETFs rather than own Bitcoins then that is a fault of Bitcoin, not of the users. The technology isn't meeting the needs of the target market.

We need to do something about that and pronto. I know most of you all don't share my doomsday outlook and by the time you realize my (Armstrong's) timing is correct, it will be too late for us to avoid a collapse into the abyss of capital controls. The idealism is nice, except the poster misses the point that file sharing had a virally popular use case.

[coinits]

True, but if people prefer to own ETFs rather than own Bitcoins then that is a fault of Bitcoin, not of the users. The technology isn't meeting the needs of the target market.

The underlying root of why ETFs exist is greed. It is not Bitcoin's fault.

[thelibertycap]

As a side note, anonymous crypto alts could mostly be spared this ETF nonsense, because people holding those value privacy and want direct ownership in contrast to the latter wave of bitcoin gone wall-street ETF holders.

[NotLambchop]

...
The underlying root of why ETFs Bitcoin exist is greed. It is not Bitcoin's fault.

Agreed.  Also fixed typo.

[David Rabahy]

Holding Bitcoin in a retirement account is not trivial; personally I am especially interested in Roth IRAs (I am predicting the future tax rate will be higher).  Holding an ETF in a retirement account is pretty straightforward although it does take a measure of trust (although not necessarily in a "central" authority).  What's needed is a viable ETF built on top of a block chain.

[iamback]

It is really great that we are thinking about the needs of the investor. And we should. But also we need to think about how to create a compelling use case for the currency. Anonymous currency is useless if we have to convert it back to fiat and slam into capital controls (confiscation via taxation, penalties for hiding wealth, guilty until proven innocent, totalitarianism, gestapo, etc) before we can spend on it merchants. And merchants can't survive if they don't also accept credit cards so the capital controls (deflation and bankruptcy dominoes) can destroy the merchants long before we get around to spending our anonymous currency (assuming they also accepted crypto currency along with credit cards but they went bankrupt before we got to spend our anonymous currency).

Crypto currency needs a virally popular use case pronto (before the Sovereign Big Bang ETA 2015.75 ideally!) that can't be done with credit cards (the mainstream banking system).

Edit: the modern economy requires holistic economies-of-scale. We need to be scaling up the use of crypto-currency faster if we are going to be ready to displace the capital controls abyss that will accelerate after 2015.75.

especially interested in Roth IRAs (I am predicting the future tax rate will be higher)

No doubt it will be higher. But you also have the very real risk of a meltdown of law and order and thus Roth terms will not be honored everything will be taken from you. I truly believe we are heading off the rails entirely (2018ish).

Is this not enough hard evidence for you of what we are up against (make sure you note the image of the SEC letter admitting what was destroyed in the WTC twin towers on 9/11).