Why Bitcoin is dropping and why you should be buying.

[nextgencoin]

All I'm hearing from the forum is the imminent death of bitcoin due to the relatively small drop in price in dollar terms of Bitcoin. I see this as an early sign that a financial collapse is approaching and therefore the perfect time for wise investors to buy. I don't know if people are familiar with the work of Jim Willie of the Golden Jackass but I recommend him, he's fringy and controversial but he has always said that the sign the system is collapsing and the dollar is on its death bed will be a massive rise in the dollar not a drop.

This also is a sign of a deriveratives implosion too. I think we will go lower, very low in fact (in dollar terms) and then we will get a spike up that will shock even seasoned bitcoiners. The absolutely only reason I'm not buying Bitcoin is I have no available fiat. If you are holding dollars then anytime from now is a good time to buy if you hold a longer tem perspective.

http://www.maxkeiser.com/2015/01/harvey-organ-derivatives-meltdown-has-begun/

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[Lethn]

Yep, that's exactly right, while I think it's too early to say for sure whether Bitcoin is an indicator of anything, I think things have gotten far too high now, they claim Bitcoin was a bubble but imagine what the dollar is going to do when it finally decides to go down. I think I'll actually be stashing by Bitcoin rather than spending it at the moment because I think we may be seeing a price spike at some point and that will be a great time to spend.

[ajareselde]

Yep, that's exactly right, while I think it's too early to say for sure whether Bitcoin is an indicator of anything, I think things have gotten far too high now, they claim Bitcoin was a bubble but imagine what the dollar is going to do when it finally decides to go down. I think I'll actually be stashing by Bitcoin rather than spending it at the moment because I think we may be seeing a price spike at some point and that will be a great time to spend.

Its just a matter of time when USD drops, and then btc, eur and chf will go sky high.
USD is in bubble, not btc, bubble passed btc long time ago..

[qxzn]

Indeed. We are in the midst (at the heights of?) a massive global bubble created by artificially depressed interest rates, the likes of which the world has never seen. Hang on to your asses.

 http://davidstockmanscontracorner.com/

[PolarPoint]

I think bitcoin is dropping because merchants are selling the bitcoins they received during christmas shopping. When those who spent bitcoin replenish their bitcoin holdings, price will rise again.

[podyx]

very low in terms of usd would be what?

What's your thoughts on this??
https://www.tradingview.com/v/Dx9hLqQ1/

[LiteCoinGuy]

All I'm hearing from the forum is the imminent death of bitcoin due to the relatively small drop in price in dollar terms of Bitcoin. I see this as an early sign that a financial collapse is approaching and therefore the perfect time for wise investors to buy. I don't know if people are familiar with the work of Jim Willie of the Golden Jackass but I recommend him, he's fringy and controversial but he has always said that the sign the system is collapsing and the dollar is on its death bed will be a massive rise in the dollar not a drop.

This also is a sign of a deriveratives implosion too. I think we will go lower, very low in fact (in dollar terms) and then we will get a spike up that will shock even seasoned bitcoiners. The absolutely only reason I'm not buying Bitcoin is I have no available fiat. If you are holding dollars then anytime from now is a good time to buy if you hold a longer tem perspective.

http://www.maxkeiser.com/2015/01/harvey-organ-derivatives-meltdown-has-begun/

pure speculation  

[nextgencoin]

very low in terms of usd would be what?

What's your thoughts on this??
https://www.tradingview.com/v/Dx9hLqQ1/

Well I don't see the drop in price to be that significant looking at the big picture either, Bitcoin to me resembles a Gold chart more than anything. My point is if you are going to measure bitcoin in dollar terms expect a drop or at least a levelling off. The bigger picture is indeed a rise. But the opportunity is that Bitcoin however much the Dollar implodes upwards will get a short to medium term drop. I expect sub 200 probably sub 100 at least before the reversal, though I don't discount a sub 50. This isn't your typical chart move, I'm talking Armageddon scale move.

[LOBSTER]

The question is: what are the impacts of a crash of the global finance system on the Bitcoin? Do you think that people would escape their savings in the Bitcoin ("the digital gold")?

[nextgencoin]

The question is: what are the impacts of a crash of the global finance system on the Bitcoin? Do you think that people would escape their savings in the Bitcoin ("the digital gold")?

I've heard this question so many times and so many times I hear people say if the financial system goes down the so does Bitcoin. But the point is fiat actually evaporates in value, that's hyper inflation. Gold like bitcoin isn't just about during a financial collapse and honestly we dont know how it will react during a financial implosion. People often want to buy food etc more than Gold or currency during extreme past situations. But what Gold does is which I believe Bitcoin will do is get people to the other side of the river. They will have something other than their dicks to hold when the dust clears is what I'm saying. Price in terms of the dollar like Gold has very little interest me actually, how can it if I believe the dollar is worthless?

So yeah Bitcoin I believe will protect you just like Gold, during the collapse it might be worthless but after one it will still be in your wallet with a renewed interest from people who thought the dollar was a store of value. Personally I do think Bitcoin will thrive during a collapse but like I said that's not really the issue.

[saddampbuh]

1100 to 270 cant be seen as "relatively small" by any standard

[nextgencoin]

1100 to 270 cant be seen as "relatively small" by any standard

It absolutely can and is by the standard set by the overal rise. Take any stock in the Dow Jones buy it and see the price rise 30,000% and then see how worried you will be if it drops 300% It's negligible.

I'm sorry of you bought in at the peak of Euphoria stage but don't then make the same mistake to think it won't regain that price and more just as easily.


compared to past drops the chart almost makes it look like a sideways move compared to past drops.

https://afbitcoins.wordpress.com

[QuestionAuthority]

This isn't going to be one of those threads where everyone strokes each other until the final climax on page 5 is it? Think deeply about the arguments presented and look at both sides. For example, "the dollar is dying and Bitcoin will rise from the ashes" debate. Is the dollar really dying and is Bitcoin capable of replacing it?

The dying dollar (economic forecaster, Gary Shilling)

1. Economic Productivity

Among developed nations the U.S. has had the strongest productivity over the last decade. For example, the U.S. averaged 2.2%, Japan 1.6%, U.K. 1.2%, Germany 0.9%, Canada 0.9%, France 0.8%, and Italy flat. When you consider the deflationary trends now at work in emerging markets and other developed nations, Gary believes that U.S. productivity will continue to outperform and help keep the dollar strong.

2. The World’s Largest Economy

The dominant currency is typically found in the world’s largest economy and the U.S. is head-and-shoulders above the rest. As Gary points out, in 2012 U.S. GDP was $15.7 trillion. The second closest, China, was nearly half the size at $8.2 trillion. If you think China is about to overtake the U.S. in terms of size, Gary says “China would have to grow 12% a year for 20 years to catch up…it’s now down at about 7.5% growth and as the Chinese economy shifts away from being driven by exports…away from infrastructure, away from heavy borrowing, and so on, their growth is going to grow even more slowly.”

3. Deep and Broad Financial Markets

Here, Gary writes, “Internationally, money—especially today when it can be transferred anywhere in a split second—wants to be where the action is. That requires not only a powerful and large economy but also deep and broad markets in which to invest. Today, the U.S. Treasury market trumps all others in size and, in the eyes of investors…, in safety as witnessed by the mad rush into Treasury bonds in times of recent global trouble."

Similarly, he states, “American stock market capitalization is four times that of China, Japan or the U.K. and is over three times the Eurozone's…Almost 50% of Treasuries are held by foreigners but only 9.1% of Japan's government net debt is owned by non-Japanese. According to the IMF, 62% of the world's currency reserves are in dollars. The 24% in euros is down from 29% four years ago. Foreigners so love investing in the U.S. that at the end of 2012, it exceeded U.S. investment abroad by $4.4 trillion, up from $4 trillion a year earlier.”

4. Free and Open Financial Markets and Economy

“Investors want to go where it’s free and open; they don’t like China. China periodically freezes their currency. They did that for example during the Great Recession. They had let it float up but then they froze it when they got worried. They’re now letting it float a bit, but they turn it on, they turn it off. Other currencies are much less free to people moving out. They typically manipulate currencies in a lot of places. The Swiss, for example…froze their currency 1.2 to the Euro when everybody wanted to be in the Swiss Franc because they worried that a strong currency would kill their exports to the Eurozone, which is their major trading partner.”

5. Lack of Substitutes

“Things can change over time but one statistic that I think is very important is global forex trading. Now, there’s two sides to this so the numbers add up to 200%, not 100%, because for every sale there’s a buy. But if you look at the trading, in 2001, the U.S. dollar accounted for 90% of all the daily trading in currencies. In 2013, it’s down from 90% to 87%. But if you think of all that’s happened in that time, the euro currency had come in, China has gotten stronger, etc. But it still has only declined 3 percentage points and it’s way ahead of anything else. The second one today is the euro at 33% versus [the USD at] 87%, the yen 23%, sterling 12%—in other words, this is the currency that people transact.”

6. Credibility

“The sixth characteristic is credibility. And that’s the only one where you can say there’s been any questioning of the dollar. And it is true that last year that Standard & Poor’s did downgrade the U.S. from triple AAA to AA+, but that hasn’t really hurt. You might remember that when they did that, Treasuries actually rallied…and it has not changed the willingness of foreigners to put money into dollar denominated assets. So, the credibility issue is the only one that is not absolutely triple-A, but it hasn’t had any decided effects so far.”

Everywhere you see the word dollar above replace it with Bitcoin. Does the article still work? Why is Bitcoin really falling? The only answer I can see to that question that seems real is that market forces (buying and selling) are changing the price of Bitcoin. The daily direction is anyone's guess. The question is, do you think Bitcoin still has a future? I do.

[nextgencoin]

This isn't going to be one of those threads where everyone strokes each other until the final climax on page 5 is it? Think deeply about the arguments presented and look at both sides. For example, "the dollar is dying and Bitcoin will rise from the ashes" debate. Is the dollar really dying and is Bitcoin capable of replacing it?

The dying dollar (economic forecaster, Gary Shilling)

1. Economic Productivity

Among developed nations the U.S. has had the strongest productivity over the last decade. For example, the U.S. averaged 2.2%, Japan 1.6%, U.K. 1.2%, Germany 0.9%, Canada 0.9%, France 0.8%, and Italy flat. When you consider the deflationary trends now at work in emerging markets and other developed nations, Gary believes that U.S. productivity will continue to outperform and help keep the dollar strong.

2. The World’s Largest Economy

The dominant currency is typically found in the world’s largest economy and the U.S. is head-and-shoulders above the rest. As Gary points out, in 2012 U.S. GDP was $15.7 trillion. The second closest, China, was nearly half the size at $8.2 trillion. If you think China is about to overtake the U.S. in terms of size, Gary says “China would have to grow 12% a year for 20 years to catch up…it’s now down at about 7.5% growth and as the Chinese economy shifts away from being driven by exports…away from infrastructure, away from heavy borrowing, and so on, their growth is going to grow even more slowly.”

3. Deep and Broad Financial Markets

Here, Gary writes, “Internationally, money—especially today when it can be transferred anywhere in a split second—wants to be where the action is. That requires not only a powerful and large economy but also deep and broad markets in which to invest. Today, the U.S. Treasury market trumps all others in size and, in the eyes of investors…, in safety as witnessed by the mad rush into Treasury bonds in times of recent global trouble."

Similarly, he states, “American stock market capitalization is four times that of China, Japan or the U.K. and is over three times the Eurozone's…Almost 50% of Treasuries are held by foreigners but only 9.1% of Japan's government net debt is owned by non-Japanese. According to the IMF, 62% of the world's currency reserves are in dollars. The 24% in euros is down from 29% four years ago. Foreigners so love investing in the U.S. that at the end of 2012, it exceeded U.S. investment abroad by $4.4 trillion, up from $4 trillion a year earlier.”

4. Free and Open Financial Markets and Economy

“Investors want to go where it’s free and open; they don’t like China. China periodically freezes their currency. They did that for example during the Great Recession. They had let it float up but then they froze it when they got worried. They’re now letting it float a bit, but they turn it on, they turn it off. Other currencies are much less free to people moving out. They typically manipulate currencies in a lot of places. The Swiss, for example…froze their currency 1.2 to the Euro when everybody wanted to be in the Swiss Franc because they worried that a strong currency would kill their exports to the Eurozone, which is their major trading partner.”

5. Lack of Substitutes

“Things can change over time but one statistic that I think is very important is global forex trading. Now, there’s two sides to this so the numbers add up to 200%, not 100%, because for every sale there’s a buy. But if you look at the trading, in 2001, the U.S. dollar accounted for 90% of all the daily trading in currencies. In 2013, it’s down from 90% to 87%. But if you think of all that’s happened in that time, the euro currency had come in, China has gotten stronger, etc. But it still has only declined 3 percentage points and it’s way ahead of anything else. The second one today is the euro at 33% versus [the USD at] 87%, the yen 23%, sterling 12%—in other words, this is the currency that people transact.”

6. Credibility

“The sixth characteristic is credibility. And that’s the only one where you can say there’s been any questioning of the dollar. And it is true that last year that Standard & Poor’s did downgrade the U.S. from triple AAA to AA+, but that hasn’t really hurt. You might remember that when they did that, Treasuries actually rallied…and it has not changed the willingness of foreigners to put money into dollar denominated assets. So, the credibility issue is the only one that is not absolutely triple-A, but it hasn’t had any decided effects so far.”

Everywhere you see the word dollar above replace it with Bitcoin. Does the article still work? Why is Bitcoin really falling? The only answer I can see to that question that seems real is that market forces (buying and selling) are changing the price of Bitcoin. The daily direction is anyone's guess. The question is, do you think Bitcoin still has a future? I do.

Yeah the dollar really IS dying in terms of the petrodollar and as a form of trade settlement generally, that's a fact with everyday news of a new direct currency swap agreement comes out. I personally think the idea that Bitcoin will replace the domestic dollar/fiat is also too extreme. I'm sure there will be more fiat systems to come, those in charge won't let go of that power easily. But you don't need fiat to completely disappear forever for Bitcoin to shine. The middle ground argument still has Bitcoin on top.


I don't know why anyone cares for the mainstream arguments for the dollar, they come from the same mouths that Bitcoin is rat poison. Of course they want to argue for the dollars dominance. The power of probably the biggest empire the world has ever seen is resting on the dollar being used and it being strong. So why the hell would anyone invested in that system want Bitcoin?

[QuestionAuthority]

The dollar can't die quickly in the classic sense because the dollar isn't just a bunch of paper that people agree has value. It's an enormously complex system of domestic and international trade that would require a century to unravel. Maybe in a century there will be a competing currency to fill the vacuum left after its demise. If that's Bitcoin, great. Of course, it won't matter to me because I'll be dead.

[nextgencoin]

The dollar can't die quickly in the classic sense because the dollar isn't just a bunch of paper that people agree has value. It's an enormously complex system of domestic and international trade that would require a century to unravel. Maybe in a century there will be a competing currency to fill the vacuum left after its demise. If that's Bitcoin, great. Of course, it won't matter to me because I'll be dead.

Currencies never collapse over decades they collapse more than often before people can get to their banks. The writing has been already on the wall for decades. I would argue since the FED was set up which actually is exactly 100 years....

[neurorit]

All I'm hearing from the forum is the imminent death of bitcoin due to the relatively small drop in price in dollar terms of Bitcoin. I see this as an early sign that a financial collapse is approaching and therefore the perfect time for wise investors to buy. I don't know if people are familiar with the work of Jim Willie of the Golden Jackass but I recommend him, he's fringy and controversial but he has always said that the sign the system is collapsing and the dollar is on its death bed will be a massive rise in the dollar not a drop.

This also is a sign of a deriveratives implosion too. I think we will go lower, very low in fact (in dollar terms) and then we will get a spike up that will shock even seasoned bitcoiners. The absolutely only reason I'm not buying Bitcoin is I have no available fiat. If you are holding dollars then anytime from now is a good time to buy if you hold a longer tem perspective.

http://www.maxkeiser.com/2015/01/harvey-organ-derivatives-meltdown-has-begun/

Is there a known phenomenon in markets in which a currency/asset has a crazy rise before an epic crash? That's how I see Wall Street, the dollar, etc right now. I'm going to check out this Jim Willie fella cause what you're saying he's saying resonates with what I feel is happening.

[sherbyspark]

The question is: what are the impacts of a crash of the global finance system on the Bitcoin? Do you think that people would escape their savings in the Bitcoin ("the digital gold")?

If a global crash does occur, I don't think people would like to put in their money into a more volatile digital currency, where they could lost more than 60% of their holdings .
Just Quoting my brother here .

[General_A]

I couldn't agree with this more:

The dollar can't die quickly in the classic sense because the dollar isn't just a bunch of paper that people agree has value. It's an enormously complex system of domestic and international trade that would require a century to unravel. Maybe in a century there will be a competing currency to fill the vacuum left after its demise. If that's Bitcoin, great. Of course, it won't matter to me because I'll be dead.

The dollar is not going anywhere any time soon. I would like to know 1: why people think this is going to happen? and 2: why people believe the petrodollar system is failing? . The signs in the market point to the exact opposite.

[nextgencoin]

The question is: what are the impacts of a crash of the global finance system on the Bitcoin? Do you think that people would escape their savings in the Bitcoin ("the digital gold")?

If a global crash does occur, I don't think people would like to put in their money into a more volatile digital currency, where they could lost more than 60% of their holdings .
Just Quoting my brother here .

I was talking to a friend about digital currencies today and he said I don't believe in digital currency is just made up out of thin air and said he only wants cold hard cash he can hold in his hands. Then he preceded to pay with his meal with a credit card....