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Very small children do (or used to) play a game called hot potato.
The basic play of the game is to pass around and object, referred to as the potato. It is passed around furiously. Meanwhile, in the background, some sort of time span is being measured by (for example) music or a person who's neither playing nor watching. At any particular time, more or less at random but subject to human whim, they may stop. If you have the hot potato when the interval abruptly ends you are "out" and play continues without you.
This goes on as the players keeping being culled for being stuck with the potato until the last two. When the music stops, the one who got rid of the potato last wins - and the one left holding it, the loser.
Perhaps it's not played by current generations and thus they don't understand the concept?
This, both as a prediction and the analogy to a game for small children, is what bitcoin is all about.*
* see, also, "Tag", "Old Maid", and similar left holding the bag games
| Ravings en masse^ |
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| "The difference between genius and stupidity is that genius has its limits." - Albert Einstein | | "If you are searching for perfection in others, then you seek disappointment. If you seek perfection in yourself, then you will find failure." - Balboos HaGadol Mar 2010 |
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Also "Musical chairs" - same idea, but you start with N - 1 chairs which N kids walk / run round, and take one away each time you stop the music. last kid seated is the winner.
You can get some good fights going if you are careful when you stop the music ... 
"I have no idea what I did, but I'm taking full credit for it." - ThisOldTony
"Common sense is so rare these days, it should be classified as a super power" - Random T-shirt
AntiTwitter: @DalekDave is now a follower!
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I didn't pick musical chair in that the players are eliminated by not having something. Aside from that it's the same picture.
My only worry about this fool's gold of the second kind is that when it goes down that it doesn't take any businesses or banks with it and for those who lose there's no government aid. I mean, really, they entered a casino willingly.
| Ravings en masse^ |
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| "The difference between genius and stupidity is that genius has its limits." - Albert Einstein | | "If you are searching for perfection in others, then you seek disappointment. If you seek perfection in yourself, then you will find failure." - Balboos HaGadol Mar 2010 |
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And it's the likes of Musk playing the tune; deciding when to stop and start; and the "kids" thinking he's got their best interest at heart. But he's actually also in the game, and wants the last chair; and doesn't care if you land on your tail bone.
It was only in wine that he laid down no limit for himself, but he did not allow himself to be confused by it.
― Confucian Analects: Rules of Confucius about his food
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Do you remember our Soapbox discussion, ~18 months ago?
One frequent visitor said "I predict an imminent bitcoin crash." A few months later Bitcoin fell from $US 20K to 10K. So he said "Hah! Toldya!". Then it went down to 6K. Now Bitcoin is at 55K.
I am not saying that Bitcoin is the best thins since sliced bread. I am saying Bitcoin is such a strange animal that nobody knows what it'll do next.
"If we don't change direction, we'll end up where we're going"
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Even further back, a friend and I at work were writing an article about Bitcoin as it was fairly new and at the time, it was reaching nearly $1000 and we predicted a crash. It did crash of course, but in a year it was even higher.
I still wouldn't touch it though.
Cheers,
Vikram.
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Something with no intrinsic value (even gold can be made into jewelry) is doomed to oblivion. Simply put, it's hardly different than a a ponzi scheme - a house of cards.
Everyone thinks themselves the market genius (until they discover how the game is rigged by and for the giant investors). They all know they'll by the bitcoins and sell before it crashes.
How much it's insanely grown feeds those who think they'll get it right. Instead of it's absolute magnitude you should consider it commonly fluctuates 20% in a week or two. A track record that would make a junk-bond blush with shame.
| Ravings en masse^ |
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| "The difference between genius and stupidity is that genius has its limits." - Albert Einstein | | "If you are searching for perfection in others, then you seek disappointment. If you seek perfection in yourself, then you will find failure." - Balboos HaGadol Mar 2010 |
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And then, perhaps, we can have the same argument when it "crashes" from insane levels down to levels much higher than we see today.
"If we don't change direction, we'll end up where we're going"
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The problem that behind every crypto-currency there is only the demand for it as value (which is actually means it has no value)...
Obviously in the long run there will be no demand for thousands of them... A few (backed by banks or government) will stay - but then there will be some kind of trace on them already... There will be a few others for the black-market, and probably we should not get near to it...
"The only place where Success comes before Work is in the dictionary." Vidal Sassoon, 1928 - 2012
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megaadam wrote: nobody knows what it'll do next.
Call me skeptical, but I imagine some folks indeed know what it's going to do, and capitalize (to the detriment of others) on that knowledge/(control?).
"the debugger doesn't tell me anything because this code compiles just fine" - random QA comment
"Facebook is where you tell lies to your friends. Twitter is where you tell the truth to strangers." - chriselst
"I don't drink any more... then again, I don't drink any less." - Mike Mullikins uncle
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Bitcoin has value because many people think it has value.
Of course, fiat money, like dollars, rupees and kwacha, also has value because many people think it has value, with an important disctinction - the government makes you pay taxes in that currency.
Cheers,
Vikram.
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Most of the currencies are backed by the value of the products a country creates - real things. Some countries even have gold reserves to be on the safe side...
"The only place where Success comes before Work is in the dictionary." Vidal Sassoon, 1928 - 2012
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This. The post is basically solipsistic because all value is subjective. Nothing has intrinsic value. Everyone has their own subjective valuation for whatever is bought and sold. The interplay of all these valuations, of buyers and sellers, is what can be described by supply and demand curves, which find a market-clearing price. You could call this price an "intrinsic value", but there is nothing "intrinsic" about it because it is constantly changing.
Many serious, professional investors are now into Bitcoin. Are they infallible? Hardly. So it'll be interesting to see how it plays out.
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Greg Utas wrote: Many serious, professional investors are now into Bitcoin. Are they infallible? Hardly. So it'll be interesting to see how it plays out.
They're keeping their hands on the trigger to be the first to get out. You can be sure of that.
| Ravings en masse^ |
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| "The difference between genius and stupidity is that genius has its limits." - Albert Einstein | | "If you are searching for perfection in others, then you seek disappointment. If you seek perfection in yourself, then you will find failure." - Balboos HaGadol Mar 2010 |
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No one rings a bell at the top. Anyone playing that game is either a fool or playing with other people's money. Which certainly does describe some of these folks...
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Greg Utas wrote: Anyone playing that game is either a fool or playing with other people's money.
You're confusing value and money here. If you don't want to loose value, put it in something that keeps it.
(Like in; not the US dollar)
Bastard Programmer from Hell 
"If you just follow the bacon Eddy, wherever it leads you, then you won't have to think about politics." -- Some Bell.
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"Money is gold, and nothing else."
"Gold is money. Everything else is credit."
--J.P.Morgan
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Greg Utas wrote: "Money is gold, and nothing else."
"Gold is money. Everything else is credit."
I completely agree; but that is the short version. First, gold is easy recognizable and has value during wars, even if you have to trade your wedding ring for some eggs. Never read about BC during wars, it's too young for that.
Wood is money. Because it has uses, and there's demand. As wood, gold is a resource, creating demand and giving it value. Also, most stable commodities hardly change in value, it is more often the price of the commodity changing in the local fiat-value.
Gold is for kings. Platinum for Emperors, Silver for the nobles. I held gold and silver, and must say that it pays more than a savings-account, just due inflation. And gold is the safer one.
Gold is the ultimate money; it has high demand, is easily divided, works good to store value (meaning, no inflation due to people "producing" gold). Silver is a good second, but is a lot more unpredictable in value, very volatile compared to gold.
BC is acting like a competitor to my silver holdings, so not happy with that. Personal preferences don't dictate economics. People are moving to BC, even at these rates that look rediculous to me; but I have truly no idea about what the future holds and where we be in hundred years.
Bastard Programmer from Hell
"If you just follow the bacon Eddy, wherever it leads you, then you won't have to think about politics." -- Some Bell.
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Silver is more volatile than gold because its monetary role has diminished. More of the demand for it is now industrial, so its value depends more on economic conditions. Mexico and China were on a silver standard (rather than a gold standard) for a while, but even silver coins went out of circulation in the US after 1964, and in Canada after 1967. Nickels aren't even made of nickel any longer, nor pennies of copper. Even most fiat is no longer backed by paper and is just electronic entries in a bank account.
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Greg Utas wrote: Silver is more volatile than gold because its monetary role has diminished.
Ehr.. no, hasn't diminished, and the available gold to silver ratio hasn't moved much. Most of that is speculation.
Greg Utas wrote: More of the demand for it is now industrial
If you follow the James Bond movies you know that not true  And in some languages, silver is a one-to-one translation to money.
Greg Utas wrote: Mexico and China were on a silver standard (rather than a gold standard) for a while, but even silver coins went out of circulation in the US after 1964
Just a few years before gold.
Greg Utas wrote: Nickels aren't even made of nickel any longer, nor pennies of copper.
Inflation, my reason to be a silverbug. Fiat is on a government fixed line (a target of 2% annual, for those who can count).
If you bad at math you deserve that penalty.
Bastard Programmer from Hell
"If you just follow the bacon Eddy, wherever it leads you, then you won't have to think about politics." -- Some Bell.
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Gold coins went out of circulation in the US in 1933, when FDR confiscated them all. Americans were not allowed to own gold again until 1975 (except for jewelry and collectible coins). I think you're referring to 1971, when Nixon no longer allowed other countries to exchange the US dollars (that they received in trade) for gold. This broke the Bretton Woods agreement of 1944.
"Inflation target of 2%" = "That's how much, in excess of economic growth, we need to conjure and give to special interests."
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Greg Utas wrote: Gold coins went out of circulation in the US in 1933, when FDR confiscated them all
Officially they did. Don't be naive and assume that all gold coins were confiscated.
Greg Utas wrote: Americans were not allowed to own gold again until 1975 (except for jewelry and collectible coins)
And thus, lots more coins became colletible
Greg Utas wrote: I think you're referring to 1971
You shouldn't think. Verifying is better than thinking.
Greg Utas wrote: This broke the Bretton Woods agreement of 1944.
Tis, but there's much more history to it than that, like Browns' Bottom.
Greg Utas wrote: That's how much, in excess of economic growth, we need to conjure and give to special interests
With an ageing population, that's just a fraction of how much refugees we require. Our economic growth is based on lending, and that growing pool is only vaiable if the amount of participants grow. Our economy is based on the amount of consumers growing, and we an aging population.
So we create wars and generate regugees, and conjure up more consumers to keep the boat going. We not taking those refugees because we think they deserve it, but because we need to grow the population, which our greying society just doesn't. No new consumers without refugees.
And anyone who knows basic math can explain how that line will break. May take more than a hundred years, but eventually, it will break.
Even if we go "rabbit" and grow our own; there's a natural limit to supply, and as such, the current trend of growth will stop. We dunno when, but math says it will.
And me? I'll be having fun, because silver doesn't have an inflation target. Like BC, the amount of silver is limited. Look up historical gains, if you really interested. Gold did over 300% over the last years, compare that to your fiat savings account.
Bastard Programmer from Hell
"If you just follow the bacon Eddy, wherever it leads you, then you won't have to think about politics." -- Some Bell.
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Good old Gordon Brown, who sold a pile of Her Majesty's gold on a bottom tick.
Your refugee take is interesting, but economic growth would be far less important without all the unfunded pension liabilities. I think that's more of a driving force. But so far it isn't working, because many refugees have low-paying jobs, or none.
Doomsayers keep channeling Malthus, but nothing so far. Maybe one day. Or maybe humankind will eventually be expanding at the speed of light. 
Gold since the end of Bretton Woods in 1971 (USD 42/oz) is a good starting point, for a CAGR of 7.8% since the printing presses really got cranked up. And in 1967, when Canada last minted silver coins, 10 cents bought a liter of gasoline. It still does, despite far greedier tax collectors.
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Greg Utas wrote: Good old Gordon Brown, who sold a pile of Her Majesty's gold on a bottom tick.
And gave more trust in our fiat, causing our economy to bloom. It's not that black and white, there's just pro's and con's.
Greg Utas wrote: economic growth would be far less important without all the unfunded pension liabilities. I think that's more of a driving force. But so far it isn't working, because many refugees have low-paying jobs, or none.
It is the only important factor, and it don't matter if they contribute. What matters is debt, and consumption. The hallmarks of the US economy.
"And nothing else matters, ejeeejej!"
Greg Utas wrote: Gold since the end of Bretton Woods in 1971 (USD 42/oz) is a good starting point
For what? As a silverbug, we cannot go back. There's not enough to go around, simple as that. If economy fails, the price of gold and silver will fall also!
Greg Utas wrote: It still does, despite far greedier tax collectors.
American? You been promised "no more taxes" during every presidential campaign in the last 30 or so years.
Taxes is what makes Europe better than the US. In every way. Feel free to move, there's some nations in Africa where you hardly pay anything
Bastard Programmer from Hell
"If you just follow the bacon Eddy, wherever it leads you, then you won't have to think about politics." -- Some Bell.
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Eddy Vluggen wrote: Taxes is what makes Europe better than the US. In every way.
I finally figured out the very weird perspective and twists you have on things!
Your real name is "Candide".
| Ravings en masse^ |
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| "The difference between genius and stupidity is that genius has its limits." - Albert Einstein | | "If you are searching for perfection in others, then you seek disappointment. If you seek perfection in yourself, then you will find failure." - Balboos HaGadol Mar 2010 |
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