Gold collapsing. Bitcoin UP.

[justusranvier]

Yeah, but there's a big difference expanding exponentially within the realm of still-doesn't-matter-much-globally and cracking through to major geo-political influence.

Think about what's been happening geopolitically in the last five years.

This isn't about the rise of Bitcoin as much as it is about the coordinated worldwide collapse of government money.

Large fiat holders around the world are looking for an exit strategy. Every time Bitcoin survives another near death experience, a few more of them decide it's worth taking some risk.

This kind of exponential growth starts off looking like a few people quietly making their way to the exits, and ends up looking like a stampede.

[vokain]

Yeah, but there's a big difference expanding exponentially within the realm of still-doesn't-matter-much-globally and cracking through to major geo-political influence.

Think about what's been happening geopolitically in the last five years.

This isn't about the rise of Bitcoin as much as it is about the coordinated worldwide collapse of government money.

Large fiat holders around the world are looking for an exit strategy. Every time Bitcoin survives another near death experience, a few more of them decide it's worth taking some risk.

This kind of exponential growth starts off looking like a few people quietly making their way to the exits, and ends up looking like a stampede.

http://lifeboat.com/blog/2013/04/bitcoins-dystopian-future

[oakpacific]

Yeah, but there's a big difference expanding exponentially within the realm of still-doesn't-matter-much-globally and cracking through to major geo-political influence.

Think about what's been happening geopolitically in the last five years.

This isn't about the rise of Bitcoin as much as it is about the coordinated worldwide collapse of government money.

Large fiat holders around the world are looking for an exit strategy. Every time Bitcoin survives another near death experience, a few more of them decide it's worth taking some risk.

This kind of exponential growth starts off looking like a few people quietly making their way to the exits, and ends up looking like a stampede.

Ah, cause and effect.

Gold bugs have been chanting for many years about the collapse of government money worldwide, yet they have made very little inroad, and their gold itself is starting to collapse.

A hero is certainly a product of his time, yet the whole false boom and feel-good hobnobbing might have lasted considerably long if it were not for one man's determination to change everything.

[vokain]

Yeah, but there's a big difference expanding exponentially within the realm of still-doesn't-matter-much-globally and cracking through to major geo-political influence.

Think about what's been happening geopolitically in the last five years.

This isn't about the rise of Bitcoin as much as it is about the coordinated worldwide collapse of government money.

Large fiat holders around the world are looking for an exit strategy. Every time Bitcoin survives another near death experience, a few more of them decide it's worth taking some risk.

This kind of exponential growth starts off looking like a few people quietly making their way to the exits, and ends up looking like a stampede.

Ah, cause and effect.

Gold bugs have been chanting for many years about the collapse of government money worldwide, yet they have made very little inroad, and their gold itself is starting to collapse.

A hero is certainly a product of his time, yet the whole false boom and feel-good hobnobbing might have lasted considerably long if it were not for one man's determination to change everything.

gold may have had a chance if it weren't for Bitcoin

[justusranvier]

Today's high of $241 has only been exceeded one other day in history.

[BitcoinAshley]

Today's high of $242 has only been exceeded one other day in history.

FTFY 

[Zangelbert Bingledack]

It's a kinda surreal feeling to be able to rally for something that will benefit the whole human race greatly, and at the same time being rewarded greatly for it personally.

It must have been a long time since the two were compatible.

My thoughts exactly.

[Melbustus]

Yeah, but there's a big difference expanding exponentially within the realm of still-doesn't-matter-much-globally and cracking through to major geo-political influence.

Think about what's been happening geopolitically in the last five years.

This isn't about the rise of Bitcoin as much as it is about the coordinated worldwide collapse of government money.

Large fiat holders around the world are looking for an exit strategy. Every time Bitcoin survives another near death experience, a few more of them decide it's worth taking some risk.

This kind of exponential growth starts off looking like a few people quietly making their way to the exits, and ends up looking like a stampede.

I hope you're wrong about the bolded part, since it would indicate that bitcoin isn't as natively strong as I think it is.

I agree that the long-term trend for fiat money will always be to inflate, and I personally think that's a horrible way to run a monetary system. That notwithstanding, I don't think fiat is going to collapse worldwide anytime soon. Obviously we can look at the debt-to-gdp and deficit math of many countries and conclude that collapse is imminent, but hard-money-minded folks have been doing that since 1971. I agree that it WILL ultimately necessarily collapse, or at least morph away from the pure fiat we have today, but I think that many people ignore the inertia of the status quo. Governments and banking sectors can collude to keep this thing afloat for far longer than level-1 logic would indicate. I think we have another few decades of this nonsense being dominant.

Which is why I hope your comment is incorrect. I don't think bitcoin is strong predominantly because of the inevitable collapse of fiat. I think that helps, but bitcoin is powerful enough on its own. It's simply ideal money; in a world dominated by gov fiat, or a world dominated by some commodity basket, whatever, a limited-supply perfect-information decentralized crypto-currency is still ideal money.

[Melbustus]

Yeah, but there's a big difference expanding exponentially within the realm of still-doesn't-matter-much-globally and cracking through to major geo-political influence.

Think about what's been happening geopolitically in the last five years.

This isn't about the rise of Bitcoin as much as it is about the coordinated worldwide collapse of government money.

Large fiat holders around the world are looking for an exit strategy. Every time Bitcoin survives another near death experience, a few more of them decide it's worth taking some risk.

This kind of exponential growth starts off looking like a few people quietly making their way to the exits, and ends up looking like a stampede.

http://lifeboat.com/blog/2013/04/bitcoins-dystopian-future

Read that for the first time yesterday. Low probability, but mildly upsetting nonetheless.

[justusranvier]

Governments and banking sectors can collude to keep this thing afloat for far longer than level-1 logic would indicate.

Yes, they can. However when it does sink it does so with surprising rapidity and with little warning.

I expect the fate of the major western nations to rhyme with the collapse (reorganization) of the USSR. The system will go on until the insiders decide it's more profitable to abandon ship.

They'll loot the public treasuries and assets for all they're worth and leave, just like the high-level bureaucrats and politicians in the USSR did in the final days of that system.

[oakpacific]

Up in the $10k range if not higher.

I will be incredibly surprised if we don't see $10k before the end of 2015, and not very surprised if we see it sometime in 2014.

$10k seems to be in agreement with the numbers I pull out of my ass, my logic goes like this: If Bitcoin is to be really successful, then we will have enough people willing to run a global payment infrastructure, at the current price, the total revenue these people are expected to obtain from mining bitcoins is about 25*144*220=$800k/day, or about $300M/year, now to estimate how much should it cost to run a real global payment system, let's look at Paypal, whose yearly revenue stands at about 5.6 billion dollars per year, which translates to about $4000-5000 per bitcoin, consider the next halving is about 2-3 years away and the bitcoin miners are expected to do a lot more, I would say $10k/bitcoin is a fair price.

[justusranvier]

$10k seems to be in agreement with the numbers I pull out of my ass, my logic goes like this: If Bitcoin is to be really successful, then we will have enough people willing to run a global payment infrastructure, at the current price, the total revenue these people are expected to obtain from mining bitcoins is about 25*144*220=$800k/day, or about $300M/year, now to estimate how much should it cost to run a real global payment system, let's look at Paypal, whose yearly revenue stands at about 5.6 billion dollars per year, which translates to about $4000-5000 per bitcoin, consider the next halving is about 2-3 years away and the bitcoin miners are expected to do a lot more, I would say $10k/bitcoin is a fair price.

I scrape the trade data off of bitcoincharts.com every day and paste it into a spreadsheet.

My spreadsheet tells me that the weighted weekly price increases, on average, by 6.5%.

Simple extrapolation says that we'll hit $1000 by the end of April and $10000 sometime in January 2015.

Past results are no guarantee of future returns, etc. but I haven't seen any case yet where we fell behind the 6.5% weekly line by more than a year, so that's why I expect $10k before 2016.

I don't see any reason why the infrastructure needed to support that scale of a Bitcoin economy won't be ready before 2016, since everybody is busy frantically building out new services.

[Melbustus]

Governments and banking sectors can collude to keep this thing afloat for far longer than level-1 logic would indicate.

Yes, they can. However when it does sink it does so with surprising rapidity and with little warning.

I expect the fate of the major western nations to rhyme with the collapse (reorganization) of the USSR. The system will go on until the insiders decide it's more profitable to abandon ship.

They'll loot the public treasuries and assets for all they're worth and leave, just like the high-level bureaucrats and politicians in the USSR did in the final days of that system.

Yes, that is indeed a potential outcome. For everyone's sake, I hope for the best-case failure-mode of long-term moderate/high inflation that causes people to shift assets and trust to a better more manipulation-proof monetary system, but yes, sudden collapse and/or war are possible failure modes as well. Regardless, I still contend that it's likely a couple decades away (though possibly not; agree that these things are surprisingly sudden), and that therefore if bitcoin's strength is relying on this eventuality as a near-term event, we have a medium-term problem.

[Zangelbert Bingledack]

The rise of Bitcoin isn't due to the collapse of fiat, but it is helped by it. And fiat is going to collapse sooner than inertia would predict. Too much is happening too fast in too many spheres, and the dollar is a key domino on the brink. When suddenly things are way different, people will turn to the Internet and find a huge built-up contingent of people talking about Austrian economics, the right to exit, decentralization, and the obvious superiority of Bitcoin. Change will come ever faster, as a precipitous slide of established power structures and deafening roar of creative destruction.

[justusranvier]

Regardless, I still contend that it's likely a couple decades away

What does this story tell you about the mindset of the upper management in the US Government right now?

http://usnews.nbcnews.com/_news/2012/04/16/11228993-ex-gsa-head-apologizes-for-823000-las-vegas-spending-spree

In a memo included in the inspector general's report, Neely — who hosted a $2,700 party at the conference — allegedly wrote, "I know I'm bad ... but why not enjoy it while we can? It ain't gonna last forever."

[Melbustus]

Regardless, I still contend that it's likely a couple decades away

What does this story tell you about the mindset of the upper management in the US Government right now?

http://usnews.nbcnews.com/_news/2012/04/16/11228993-ex-gsa-head-apologizes-for-823000-las-vegas-spending-spree

In a memo included in the inspector general's report, Neely — who hosted a $2,700 party at the conference — allegedly wrote, "I know I'm bad ... but why not enjoy it while we can? It ain't gonna last forever."

Heh... I get where you're coming from. It does look imminent via many measures. The obvious ones like debt-to-gdp and the trajectory thereof, then things like housing as a % of income, income distribution, financial sector as % of total gdp, % of population paying taxes, etc...

Still, there have been (many) bleaker times without fundamental change. This country *is*, at its core, quite productive, and that kernel can probably be milked for a while longer through increasingly creative financial and political means (at great long-term cost to the majority, of course).

In short, I used to look at the math and think collapse was imminent. Now I'm actually *more* cynical in a way, with the opinion that the abuse can get worse and last longer before the market/people force a significant change to the dynamic.

[justusranvier]

This country *is*, at its core, quite productive, and that kernel can probably be milked for a while longer through increasingly creative financial and political means (at great long-term cost to the majority, of course).

Have you checked the labor participation rate recently?



Obviously there's no way to know exactly when it all falls apart, but I expect some excitement within the next 5 years, 10 at the longest.

[Melbustus]

This country *is*, at its core, quite productive, and that kernel can probably be milked for a while longer through increasingly creative financial and political means (at great long-term cost to the majority, of course).

Have you checked the labor participation rate recently?



Obviously there's no way to know exactly when it all falls apart, but I expect some excitement within the next 5 years, 10 at the longest.

Yeah, that's a good one. Key numbers on that chart are probably high 50s, which just eyeballing the longer-term chart (here: http://en.wikipedia.org/wiki/Labor_force), were pretty constant from the 1940s through mid-1970s, when women started making up a significant % of the labor force and drove the whole number higher. Get much below mid 50s on that stat, and we're in uncharted territory.

[User705]

Official labor force numbers are bs since they don't count any off books work.  Most modern economies have so many benefits it's profitable not to work.  I read that in California, USA the total benefits of not working come to over 40K USD per year.

[justusranvier]

"Labor force" by standard definitions includes government employees and defence contractors. The actual size of the private sector is frighteningly small.