I'm not much of an economist or speculator, but I was curious to get this groups input on a thought of mine:
Looking at the Bitcoin "Total Hosts" graph hosted at http://bitcoinstatus.rowit.co.uk/
, it makes me wonder if Bitcoin isn't set for a long decline and the price has only remained stable at $5 due to hoarders who won't liquidate because they don't want to be "left behind" when "thing turn around".
You can't deny from those graphs that the network is on a downward trend as far as people actively using Bitcoin. Technical issues that have been brought up years ago as weaknesses in the technology any why it could never be used as a high transaction payment system haven't been addressed.
So I guess to the speculators out there:
1) What's holding the price up if there's a constant influx of mined coins to the market from miners and there is a downward trend on network activity? (Are there that many "dark traders" who don't even have a Bitcoin client and just keep all their funds/coins in their brokerage account?)
2) Couldn't it be said that the longer the price remains constant the more risky it is for someone looking to invest new capital into the system? An example I think of is if someone tomorrow were to pump $1M into MtGox and drive the price up to let's say, $10, there's be an immediate flood of sells on people trying to get a piece of that capital pie and the price would instantly come crashing back down.